This is of course assuming the best outcome, and our drill continues without incident, and good shows of gas are encountered. Not a good idea to count your chickens before they are hatched as they say.
Due to lack of time value left on GDNO, we can expect ‘if’ GDN moves up in to the 20c range, the price of GDNO will not rise by an equivalent number of cents until we hit an intrinsic value of about 5c or 25c for GDN.
For eg, if we go to 22c, I would speculate GDNO will be low 5c. From there, at a guess, the approx price correlation might be something like: 23/5.5, 24/5.7, 25/6, 26/6.5, 27/7, 28/7.5, 29/8.5,30/9.
If the stock runs hard, the oppies will reluctantly follow, that is they won’t catch up to intrinsic value immediately, they will wait until some price stability is achieved before trading at or near intrinsic value.
For eg, by some crazy lucky twist of fate, GDN launches to say 50c, the oppies would take a while to get up near the intrinsic 30c.
Of course we have to accept the possibility that the stock will not climb in to the 20’s during the life of GDNO if something goes wrong with drill or gas is not there in the right quantities.
GDN Price at posting:
20.5¢ Sentiment: LT Buy Disclosure: Held
