Hi
@DianabolDon
Apologies for not replying sooner though was please to see and read
@airconditioner response to you. - Most will know that AC and I tend to bounce ideas between us behind the scenes when it comes to the fundamentals of a stock and that is one of my reasons for being here. I have never really harnessed the ability to read charts I just look and get a feel like most here may do also. It isn't an exact science.
Your question surrounding the ongoing use of cobalt is an interesting one and I might sound like I am singing the same tune as AC in this response however I didn't want to not say anything and be thought to be ignoring what is a very good question. - I hope this answer gives a bigger picture of my reasons for investing here and a greater understanding of my strategy. Whilst some things I never reveal it is fair that I explain my mindset towards this investment for clarity.
For me it goes like this.. Whilst I have been dubious about cobalt and its future in China where a majority of global demand in resources comes from there has been changes in their perspective when it comes to its use. - They have even worked out a way to ensure a vast majority if not all supply comes from the DRC. Build a train line or do something else in order to donate to the region and in turn receive benefits in other areas in return.
As AC indicates and also an exceptionally well laid out recent presentation by CLQ also shows, cobalt and Nickel form a larger amount of a battery than that of lithium however lithium is the popular energy storage method with or without cobalt. It is for this reason Galaxy has been my mainstay and regularly invest in stocks in order to increase my holding there by returning some of the profits I secure.
I am aware that many say I flip flop, however that is based on fundamentals that I see and in no way intended to move a stock up and down. - I think I could say at least within myself that I am an ethical investor in both what I buy and also do surrounding it and with that said is one of the reasons I regularly annoy AC with my positive and also negative thoughts on various opportunities. - In my travels he has always struck me as a decent honest guy and entirely different to anything/anyone I have come across. - OK so I have a bit of a crush! <3 - Though I wouldn't have come here with what I laid down on the table had I not felt entirely convinced.
Yesterday when the stock rushed up to ~90c I felt it was rushing up way too fast with no red days and whilst that doesn't mean that it is not worth more it just felt like FOMO in that moment in time. - I took that opportunity to remove my initial holding and take some profit, some of which I returned to my beloved lithium stock.
So now I am free carry. I don't care if the stock goes up nor down it has cost me nothing to be here however I am considering this as a long term investment and have protected myself from the erratic movement we will see from time to time, so with that said my perception is less likely to be biased along the way. - Maybe that can be appreciated?
When it comes to my point of good ethical investing it is by way of sharing my honest thoughts with other traders I regularly keep in contact with privately and also on Hot Copper which I thoroughly enjoy. I don't ask anyone to buy, nor do I tell them to sell and free carrying allows me to keep myself in check and be impartial - for me I simply present my view and feel best for letting it off my chest.-Sometimes I do get a little carried away and the moderators can vouch for that. - Sorry for keeping you so busy. :p
One trader I spoke with yesterday told me that they had also pulled back a little and were able to pay down their car loan.. They are the feel good stories that I like to hear however am also empathetic to any that brought in at the top and are down 30% of their holding. It must be a difficult time for them at the moment so we must acknowledge that also.
With that said I do consider this big/little company as a buy. It was never going to be easy to draw my attention into a stock to the point of the amount of investment I initially made. - I have invested in some doozeys from time to time as a small play but have always been fortuitous to have that gut feel and return a profit.
Whilst it is true their are various other battery chemistries that a car company like Tesla can 'make do' with I believe it will be very difficult for them to move away from cobalt included batteries when they consider the improved performance they offer. Tesla need to continue to stand out from the other manufacturers by way of km/miles per charge and at this time a cobalt inclusive battery is that differentiating point. - A cobalt inclusive battery would be difficult to not include to achieve that goal.
Elon Musk has stated in one video that it isn't the cost of the materials so much that increases the price of a battery nor the construction of the vehicle. It is the ability to buy all those components and assemble them as efficiently as possible. He reminds me of Henry Ford first setting out on mass production and has been smart to include a great deal of automation which keeps costs down or at least a sustainable level.
Elon's goal is to be the guy that changed the world and supplemented fossil fuels for renewables. - They will sing songs of him in the future no matter what anyone says today. - A truly admirable man.
With that said, my understanding is that the Gigafactory and any batteries that go into a Tesla are done via way of a partnership with Panasonic who I understand from
@airconditioner conversation with Anthony Tse of Galaxy gave them a tap on the shoulder and was politely declined due to very unfavorable pricing. - They know how to squeeze the walnuts.
My point is sharing that story is that I don't perceive pricing would be an issue.
There would be contracts all the way down the supply chain for them so a spot price isn't reflective of the price that the Tesla/Panasonic Alliance would be paying. - So with that said, I am not concerned at the moment if they would choose to divert to another lower grade of chemistry, though I would be interested to compare the difference in margins they might achieve on a complete vehicle fit out. - I don't think it would make enough of a difference when comparing the bigger picture benefits.
Moving beyond that and back to my point of ethical investing. The one thing that stood out to me other than the fact they are in Australia is the sheer resource size by comparison to the peers local and international peers that are not in questionable locations.
I am sure many can show comparisons between this resource vs others in Australia and take into account the number of shares on offer.
@accaeric @PamplonaTrader and
@Green Bull would be the best for that type of information.
But what I want to talk about is ethical responsibility of both the consumer and also the company that buys the cobalt. - It's simply this. If you want to survive as a manufacturer in this socially conscious social media world you better make sure that there are no little children as young as 7 being buried in holes dying nor connotations of slavery as a result of even low wages just so someone can have their Tesla or new iPhone. A similar line can be drawn to that of palm oil however I have never been convinced when it comes to ethically sustainable palm oil.
So whilst I feel I have a responsibility to invest in companies that share my attitude here I also want to make sure that I am in the best of its field. - So here I am, in the developed world's largest cobalt resource. Anyone able to challenge that? - Let me know.
As
@accaeric pointed out today I do perceive that this stock will be approached for a take over or joint venture. Whilst I do hope that it is my beloved Galaxy that takes that baton it doesn't mean to say they are the only ones that might be interested.
For me whilst I consider that gold is a great hedge in a downtime I see that renewable energies are about national security now not oil nor coal - You don't want to be the last country jumping on board and at the mercy of what might be exorbitant pricing in order to maintain a profit margin for the supplier and their stake holders. - Some have said that those that dont jump on board producing their own energy at home will end up being the ones that have to support the costs of the grid. I draw that line directly at those countries that don't jump on board with renewables. - I really hope Malcolm 'Big Mal' Turnbull is reading this.
So, here we are.. Biggest resource in the developed world, Drilling that will likely boost those figures and a company with a small amount of shares that allows solid maneuverability for growth as each point needs to be achieved with or without a take over or joint venture.
I hope I answered not only the question but also provided a bit more insight as to my reason for getting on board.
(20min delay)