Price Vs FA Vs resource fundie

Hi all,

I haven't posted for quite some time...I honestly felt I could not add anything of real value, whilst waiting on results, to the FAR board.

I caught up with a few 'old' resource fundie mates the other night; booze and bullsh*t flowed freely in ever increasing proportions. Albeit from a pre-existing high level, our expertise continued to expand, hardly keeping up with our BAC.

Until some pr*ck brought up the subject of performance.

The mood quite suddenly sobered. Analysts/fundies with 20-30 years experience reached for the Pellegrino as, pretty much all of them, noticeably and quietly put the BS brooms back in their closets and confessed, with varying degrees of honesty, that this was, by far, the toughest year for any resource fundie. The star performers of 3-5 years ago are now fighting for relevancy within their fund.

Continual stripping away from resources sector by the asset strategists (usually detractors of the resource and their volatility) along with redemptions specifically aimed at even those funds with neutral resource weightings has been ferocious. The incredible money flow out of the sector, especially anything outside of the top 10 resource stocks, is what is currently overshadowing any bottom-up fundamental analysis of subsectors or individual companies such as FAR. Many fundies are told/ordered/have no choice but to cut sub-beta positions. This cutting has been continuous, relentless and continues today. So don't necessarily blame the shorters of FAR.

Usually stocks like FAR can hide behind a fund's huge weighting in other resource leaders...but the performance of BHP, STO, FMG etc, etc has stripped any absurdly undervalued stock of protection.
Unfortunately, its now generally viewed as strong evidence of steel cojones, substance abuse or desire for early retirement for a resource fundie to recommend any increase in weighting in even sector leaders, let alone juniors.

Hey...they all agreed (with increasingly loud sponsorship from yours truly) that FAR's discovery was/is a real company maker; a project with ever decreasing risk (SNE2 announcement this am) and increasing upside (albeit from a pretty hammered SP). In 1-2 years time, we'll all be saying..."we were there, we backed it....but ...lousy performance/redemptions/asset reallocation killing us...had to sell early...had no f*cking choice" was the average comment.

And they all mumbled they'll be buying stocks such as FAR back at higher, much higher prices when the external forces allowed fundamentals back in the asset allocation meeting.

Someone then brought up the topic of BS high-tech backdoor listings through fallen resource shells. The Pellegrino was quickly tossed for 6 more bottles of red and the game was back on....

Cheers,