coincidence?, page-16

First 16 Last

Share
Profile

Follow
Forry

172 Posts.

05/11/15

13:45

Post #: 16331931
Share

Originally posted by Taurean7 ↑

I thought you made two important observations Orson. One relates to opinions expressed on HC, the other to market shenanigans.

Every market transaction has a winner and a loser. It is important not to provide your counter-party with behavioural information that might make you the loser. Well-intentioned forum comments such as “if xxx is announced I’m buying because the sp then should rocket to at least yyy”, or “if it breaks through zzz I’m out because the next support level is 20% lower” would be gold to a trader, particularly if those opinions convince other readers as well.

The shenanigans you refer to I think just need to be accepted. Until a company is priced in accord with its value, as demonstrated by reported earnings rather than promised earnings, investor sentiment always will be vulnerable to manipulation. If a company’s fundamental value is obvious to all market participants its share price will become more difficult to manipulate.

Share prices are determined either by announcement flow or cash flow. An announcement that promises good future profits will cause a spike before price slowly falls back, often to the original level if further supporting announcements are not forthcoming. There is a limit to how long investors can maintain their enthusiasm, particularly with profit takers around. When an unexpected inflow of cash is announced the higher price levels generally will be supported.

The lack of price/value correlation for young companies still developing their product markets means that their shareholders don’t have the fundamental basis that would give sufficient confidence to over-ride manipulation. I think it would help to lower our stress levels a bit if it is recognised and accepted that market shenanigans can be expected for listed companies like AJX in their early stages. As you say, they should mean little to the longtermers.

Cheers

Expand

"Every market transaction has a winner and a loser". Not the case Taurean7. I buy XYZ share at $1.00 and sell at $1.10. I'm a winner. You buy my shares at $1.10 and sell at $1.20. You're a winner. The next guy buys you shares at $1.20 and sells at $1.30. He's a winner. Next guy buys at $1.30 and sells at $1.25 because he see's a better investment. Is he a loser? He picks up his other investment for $1.25 and sells at $2.05. He's a winner. Or, are they all losers because theXYZ share eventually went up to $10.00?

AJX Price at posting: 91.0¢ Sentiment: Hold Disclosure: Held
12 Upvote

0 Great analysis

Reply

Top Stories

M4M

Macro, Norden set up transport solutions initiative for West Pilbara

What's causing the cost-of-living crisis, and how to navigate it

TLG

Talga Group wins key permit for flagship graphite mine in Sweden

Week 42 Wrap: HotCopper's top picks; new ASX 200 record; world yawns at war

MKT

The ASX can overlook its Telecomm small-caps. Here’s one diversified brand with an international footprint

NVU

Nanoveu surges 10% after benchmark testing for new AI chip begins

IRX

InhaleRX snags $38.5M in funding from VC biotech funder Clendon

SNX

Sierra Nevada raises $2M for silver exploration at Blackhawk

SWP

Swoop lobs $18M offer at microcap telecom Vonex – in which it holds 19.9%

MTH

Mithril's drilling in Mexico picks up silver at 997g/t, gold at 28g/t