ITM Chart, page-573

I second the comments made above, tough times in the markets create incredible opportunities for value investors. Investors get so caught up around share price and looking at charts, in my view the two most important things when it comes to investing is management (competence and integrity) and company value. The only time you consider share price is after determining what value is on offer, value compared to price determines if a company is fairly valued, undervalued or overvalued. The real investors understand this premise.

In my opinion, the further this falls the better value it is, especially if you have a long term mindset (3-5 years). I am sitting patiently waiting for my next parcel to continue dollar cost averaging. Anyone who thinks they can predict where the share price is going up or down on a day to day basis and thinks they know where the ‘bottom is’, is unscrupulous and should not be trusted. Nothing against traders here either.

Eventually over the long run, the underlying share price starts to reflect true company value or what the company is approximately worth. You need to patient when it comes to investing and don’t let fear or falling share prices drive your decision making. The sheer disconnect between share prices and company value is evident to see in the markets at the moment. Some falls in share prices are warranted though just to be clear. There were companies out there who were worth billions of dollars from a market cap standpoint who hadn’t turned over a dollar of profit let alone a dollar of revenue, it was always going to end in disasters for some companies share prices.

If you want real examples of other shares, look at IXR and LPI share prices over the last six months , two other holdings of mine where the market was not interested in either of them, then all of a sudden a few announcements change the trajectory of the share price because the market starts to realise they didn’t understand what value was on offer and were essentially giving away the company too cheaply. People can look at my comments on those forums to gain an understanding of my investing thesis and why I was buying when the broader market was selling. Sometimes the broader market needs a prompt to realise the true value on offer in the form of a study (scoping, pre feasibility, definitive feasibility etc). I am not always right on my interpretation of value or judgment of management but I back myself to be right more times than I am wrong.

The only really disappointing thing as of late was Mike affirming that West Lacroma didn’t come up with the goods (For now) even pre assay results release. At least he was honest and open about it, which speaks volumes of Mike’s integrity and competency. I suspect they may throw a few diamond drills at the anomaly when it is prudent to do so (focus is clearly on Lacroma central at this stage and advancing work here around met and resource). Comments were made by Mike around how visibly soft the ore is at Lacroma central, easy to dig with almost no grinding to get the graphite out. Low cost operation is e highly likely here. There should be some reprieve in the next few months regarding graphite pricing due to China shutting down graphite mines between November and February. Cheers, CP.