Thanks for sharing your story Pokerface, even 10 x is a stellar...

Thanks for sharing your story Pokerface, even 10 x is a stellar return and most people would take a 1000% gain everyday of the week, let alone 100 times your money. Agreed, you dabble in the market long enough and you will get burnt. I certainly try and avoid making mistakes but as you have alluded to it is inevitable over time. The key is learning from your mistakes and hopefully never to repeat them again.

A couple of mistakes I’ve made include investing in a company that has debt outstanding solely to private equity. I learnt this tough lesson during Covid whereby all of the equity holders were wiped out in a ‘restructure’ and the company was taken over by private equity. It was an American based company too so there was little asx equity holders could do about it! My lesson here is to only invest in companies with bank debt, be careful with sovereign risk and buy a company that produces significant cash flow to cover its interest charges (minimum 3 x). In most instances, banks also typically have no interest in taking over the business to operate and sale of the business is generally last resort.

My next lesson was learnt during the banking royal commission whereby I bought an insurance based company that received trail commissions. I thought I was buying an undervalued insurance company, a cigar butt style company where I thought I was going to get one last rewarding puff. As you guessed it, I was burnt and still carry the scars today. The company was sold to a private company and the rest is history. Someone else is reaping the benefit of my investment. The lesson I learnt here is always do your due diligence on management before buying into a company, the figures are important but not as important as the people who are driving the figures, as they ultimately decide your fate.

Someone a lot smarter than me once told me, smart people learn from their mistakes, intelligent people learn from other peoples mistakes. Hopefully those stories help other holders avoid the same mistakes that I have made.

Apart from those two indiscretions, I have done quite well over the last couple of years, my portfolio mainly consists of commodities that I expect to have a large role into the future: copper, lithium, nickel and rare earths. I like buying these type of commodities due to their various applications in society now and into the future. I expect them all to have solid compound annual growth rates over the next 10 years. I will only buy a company that I consider to be undervalued and have ethical knowledgeable management in place. In the short term, I hope there is more volatility in the Trek share price so I can continue to load up. I expect the markets to be a lot more volatile due to rampant inflation, geopolitical tensions and rising interest rates.

I have the utmost faith in Trek management and share in the same enthusiasm regarding the upcoming campaign. I have a good feeling about this company. Can’t wait to see what we could discover, let’s hope this company delivers for the both of us and we make 10 x our money. All the best, CP.