where ovr stands today, page-15

Neddo,
agreed. I have seen this happen far too often. But that is where the discrepancy is in the markets. Investors are not knowing the value of the underlying company before finding their price points. They cast their eyes on the actual price of the stock rather than the Market Capitalisation; without any idea of what the company has in its balance sheet - where it be tangible and/or intangible.

Seriously, one does not really need to be technically savvy or to be a geologist to realise certain key points. For example, management has clearly indicated that the resource base is going to increase with the latest intercepts. This, in itself, should tell investors the recent NPV calc of $174 million [undiscounted] has a high chance of heading way above $200 million. OVR sits at a MCap of 40 million now and is in the midst of completing the DFS...with a recommendation to mine the ore coming up. One does not need to be a rocket scientist to understand that they are undervalued. If one thinks the current share price is expensive, then i am afraid they will be left behind when the news gets released.

That said, i have come to the conclusion that the ASX [primarily the small cap sector] is much more influenced by the herding of traders and short term speculators. Though this provides liquidity to the stock, it also increases the chances of a disconnect. The traders move from one stock to the next not knowing much about the underlying fundamentals of their purchases. This is a dangerous game to play when volatility sets in. For the professional trader, this environment is extremely beneficial but my worry lies with the average joe. Australia's small cap sector is miniscule compared to the TSX markets and as such can be influenced much easier with the influx of traders moving into the corresponding stocks. Due diligence is paramount.

In the end, the cream will rise to the surface. In my experience, i have seen stocks with strong fundamentals and lucrative resource bases lag for months to years on end, before the general market actually get hold and understand the story. Though one loses opportunity costs sitting on these plays, the relative profit margins are tremendous when the rerate happens. The herd moves to other plays whilst the value investors accumulate to profit when the market actually processes the news. The investors who have the knowledge to process results and fit the pieces together will have a significant competitive advantage.