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Mofra said:
Ha. It's a sacrifice of profits by not jumping in too early.
Timing of exits is even more difficult
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Yeah really dont even try so my tactic is generally to just trickle money into stuff on the way down.

Then usually just sell all at once.

And yep selling is like 10 times harder than buying imo.
 
Taylor said:
To me it looks like an industry that people will have bought in late on, be holding in a dip and sell out near their buy in "breakeven" point building in a sort of cap for a while before it breaks through.

Gold is similar.
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Not everyone my friend. I jumped on pretty early so have very strong positions on a few lithum stocks, mainly PLS and AKE but a couple of others too. I had Galaxy and Orocobre shares which merged to form Allkem which is about to merge with Livent...that's how far back I got involved.

I did the same with uranium, grabbed a heap of BOE at under $1.50. Will hold until I need to sell.

With most things time in market is better than trying to time the market. Take PLS as an example, I purchased at something like 90c initially (around 2019 IIRC) and it dropped to under 20c during Covid but instead of topping up I just decided to ride it out. I wish I had topped up but at that time nobody really knew the future of lithium so it was all speculative. It closed today at $3.92 and it is just coming out of a dip. I could have sold when it hit $5 a few months back but I think longer term there is value to be had and I am just not willing to pay the tax, play something and and buy in later on. My timing just isn't that good.

I did cash out some of my original stake when PLS hit $3 to buy BOE...so I am playing with house money on most of my lithium stocks now.

Where I have been burnt is on a few small cap stocks my father in law recommended. I'm doing ok there overall but I spunked a heap on LVT (well documented in here).
 
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Bitcoin and Ethereum are ripping higher.

I'm wary of investing much in crypto (they make up 3.5% of my portfolio, including miners), but the impending approval of the Bitcoin spot ETF in the US is likely to send Bitcoin prices higher, which will then have a knock-on effect on other altcoins.

Am slowly moving more into Chinese stocks - put $1000 in the Baidu ADR and will put $750 into MNSO. Also looking at investing in NKE, FMC, MRNA and HSY (NKE due to its recent decline, FMC/HSY/MRNA because of their dismal past-year performance). Funnily enough, I actually managed to sell HSY close to the top - probably one of the few correct calls I've made over the past 2 years.

I do expect EMs to do quite well this year generally, which is why I put $1000 into IKO (S Korea) as well.
 
Have invested in FMC and NKE, will invest in HSY. FMC worked out well; NKE didn't.

I expect the S&P 500 to go down by 3-5% from here, before rising again. Historically, its performance during the first quarter of an election year is mediocre.

Have bought a 4800/4500 put spread expiring mid-March.
 

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G'day all.
First timer in the thread. No expert but always keen to learn and sh*talk about stocks.
Only investing ASX as it fits my strategy and don't have the time to look further afield. Portfolio currently:
AVL 9%​
4DX 3%​
FLT 15%​
WEB 17%​
GHY 27%​
ZIP 29%​

Had 15% FMG until last month (in at $8) and was very happy to take that after holding for so long. Threw the cash into the stocks I'm most bullish on for 2024 - GHY & ZIP.

I always find it interesting to hear others' views on what they are investing in and why. For me, I will always be attracted to companies that are new, innovative and disrupting an industry. I'll share some of my thoughts on those I hold that fit this bill and why I like them.

2024 Bulls
I have a love/hate relationship with ZIP Co Limited (ZIP). I was on them super early (80c in 2018) and cashed out my initial investment around the $4 mark. With the remaining 'profits' I rode the wave over $12 ATH and bought more around $3 thinking bullish thoughts .... eventually closing the position at $1.50 for a sizeable loss and absolutely kicking myself. On reflection, I was blinded by my own bullish views, ZIPs glamorised reports, and the shorters continually hammering the stock. I sold out of frustration, not that I didn't believe the company had what it took to succeed.
Despite this I got back in during 2023 but am being more cautious. The February half-year report will be very telling for ZIP's 2024 performance. If they report cash flow positive and were able to achieve that during these tough conditions, then the year ahead with expected rate drops is going to be great.

My other bull for 2024 is Gold Hydrogen Limited (GHY). Listed only in January 2023, they have executed targeting exploration for hydrogen in South Australia and have confirmed world-class concentrations of naturally formed hydrogen and helium. They are commencing flow rate testing in Q1/24 and if confirmed as commercially viable they have stated an immediate play on the helium (which can be easily separated from the helium and bottled for immediate sale to market) could happen asap. As this is naturally formed helium (i.e. not a byproduct of a hydrocarbon production environment) it is 'green' helium. This is very rare.
FYI - 95% of hydrogen produced is from natural gas at a cost of $5.60/kg(AU) whereas Gold (or White) hydrogen is produced at $1(AU) per kg. The current on-trend Green hydrogen is ranged between $4-$7.
One to watch for sure. I'm expecting impatient profit takers to cash out a bit over the coming few months, so I plan for another buy if this hits 65c.

Small cap long hold disruptors
Australian Vanadium Limited (AVL) is developing the Australian Vanadium Project in WA. The orebody is one of the highest-grade vanadium deposits in the world. Vanadium Flow Batteries (VFB) beat Lithium batteries in many key areas (read here).
Recently completed their vanadium electrolyte manufacturing facility to produce up to 33MWh per annum of the electrolytes. Horizon Power has recently ordered a 220MWh VFB through AVLs subsidiary (VSUN Energy) for a trial.
AVL are close to an acquisition of Technology Metals Australia Limited (TMT) who operate a project on the same orebody. Plant to be constructed 2024, production targeted for 2025. 25yr mine life.

4DMedical (4DX) is an Australian based medical technology company that has successfully commercialised four-dimensional lung imaging solutions in a world first. It has the first FDA cleared respiratory imaging solution and is patented in key jurisdictions across the globe.
In December they acquired Imbio, an US-based medical imaging company that has x4 FDA approved technologies. Imbio tech paired with 4DX tech can more accurately detect early-stage diseases during scans.
Key achievements in 2023 include entering partnership with US Veteran Affairs, commercial agreement for use on PHILIPS imaging systems, and 4DX scans added to US Medicare for subsidies.
On a journey to be the first choice in the $14b respiratory imaging sector in US.

COVID low SP purchases
Nothing new to say about either of these two old timers. The last of my COVID lows buys. Both Flight Centre (FLT) and Webjet (WEB) are still slowly recovering to pre-COVID levels but I'm thinking 2024 may be the time for closing my positions.

As always, DYOR.
Cheers, Fred
 
Kram said:
Yeah great work on buying them cheap but 1/3 of the portfolio in travel would need to be pulled back anyway.
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I'd normally completely agree with that sentiment as I've had a faily balanced spread in the past.

The expected economic turnaround in 2024 means I'll have to ride them out a bit longer.
 
Another bad day for the S&P 500 (and by extension the ASX).

Healthcare stocks appear to be standing firm, though.
 
Taylor said:
Is the value in these all in cap growth since you sold your FMG shares?

With your money making 25% a year when you sold out of that, even with nearly 300% return on price - those smaller stocks must protect as massive winners for you?

What's the strategy long term?
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I've a contact at FMG that has flagged Sept'23 was the last +$1 div for a while. Felt it was a good time to get out to make a stronger play on GHY/ZIP and their near-term capital growth I predict hits in Q1/Q2 2024.

I had GHY on watch since IPO. Strong board (former Shell, Santos, & Hon. Alexander Downer) with plenty of related geo/explo knowledge with industry consulting knowledge/contacts. Very clear company vision and plan that has hit all milestones in their first 12 months. Two very successful drilling events confirming their target in high concentrations in Oct/Nov have led to an oversubscribed cap raise in December (all insto). GHY currently undertaking flow testing and will finish by March. If March flow show positive results I'd expect SP to go through $1 and progress a more aggressive expo to build data on the volumes in play. Geo estimates put their tenements between 200kt and 8,800kt of hydrogen. Nothing on helium yet.
If before March is dips to 67c I'll buy more, otherwise am prepared to hold for the long term.

ZIP were another I wanted to have a bigger position on in the near-term due to their upcoming Q2 FY24 results on January 30th. They have been toying with "cash flow positive" and other buzz-jargon for the last 12 months and this is the most likely point for it to happen. Have been alot of $100k+ buys over the last few weeks. A $300k buy today. Following big money like that makes me feel more confident than concerned.

At this stage the AVL/4DX are purely speculation plays. AVL has a very strong balance sheet to support the merger and the low vanadium prices (around the lowest price in years). Price usually hovers around double what it is now. For 4DX, they get a couple of US contracts this year, they'll be attractive to insto buyers. They have world leading tech that improves patient outcomes immensely so can also see them being attractive to be bought.
 
Decided to sell WBA for a profit after it cut its dividend.

I only bought it because it was at GFC-price levels.
 

“Tough market conditions” not limited to Core Lithium​

Core suspends mining at its flagship Finniss operation due to "tough market conditions". Which other ASX lithium stocks are at risk?
2 HOURS AGO
PRINT WIRE

Carl Capolingua
Livewire Markets

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As a market analyst, quite often I’ll report on a “surprise” company announcement. Unfortunately for Core Lithium (ASX: CXO) shareholders, there were few surprises in this morning's announcement it would be suspending mining and some development activities at its flagship Finniss lithium operation in the Northern Territory.
Citing an 85% fall in the price of spodumene concentrate over the last year, which includes a more acute decline of 50% since October, Core intends to “temporarily” suspend mining operations at Grants Pit – currently its only producing asset. Mining would recommence “should market conditions improve”.
Processing of ore stockpiles from Grants Pit would continue, however. Core noted it had 280,000 tonnes of ore stockpiles, which it expects should be sufficient to maintain production at its concentrator until “mid-2024”.
Core’s development project, BP33 which is presently at the early works stage, will be placed on care and maintenance, but work continues on an updated pre-Feasibility study. On exploration, Core noted it had completed its 2023 campaign, and it continues to analyse this data. Results would be announced in the “coming months”.
CEO Gareth Manderson described the current market conditions for the company as “tough”. The decision to suspend mining operations was part of a broader Strategic Review which aims to “reduce costs and “preserve business value and optionality”.
The company plans to update the market with revised operating costs, exploration, studies, and capital expenditure guidance for the rest of the 2024 financial year when it releases its December quarterly report at the end of this month. An impairment of the carrying value of Finniss was flagged, with details to be released in Core’s first half results due in February.


Carl Capolingua

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No surprises here, thanks Kerry! 👍​

The reason I say there are few surprises in today’s announcement from Core, is I am an avid reader of everything my learned colleague Kerry Sun writes! In a great article where he outlined the cost curve for several ASX lithium stocks all the way back in November, Kerry noted Core was the company most likely to come under pressure at then-current prices.
At the time of that article, the price of spodumene concentrate was around US$1,400-US$1,800 a metric tonne depending on which data provider you were looking at. Kerry noted core produced at around $1,225 a metric tonne in the September quarter. Spodumene concentrate prices are now around US$950-US$1,000 a metric tonne. The maths speaks for itself. (If you’re looking for daily lithium prices and charts, I post these daily on X / Twitter!).
It's worth noting the production costs of other major ASX lithium producers. By Kerry’s reckoning, at current spodumene concentrate prices, there’s still some meat left on the bone for each producer he surveyed. Pilbara Minerals which produces at around US$400 a metric tonne, and IGO which produces at a world-class US$173 a metric tonne remain the pick of the bunch, whereas Piedmont Lithium / Sayona Mining’s margins are starting to look a little razor thin…
ASX lithium stocks production costs (September quarter converted at 0.65 AUDUSD where applicable, Mineral Resources June quarter guidance)
ASX lithium stocks production costs (September quarter converted at 0.65 AUDUSD where applicable, Mineral Resources June quarter guidance)
But this assumes spodumene concentrate prices won’t go lower. As a technical analyst, and more specifically a trend following technical analyst, I have to say I have some reservations over this possibility when I look at the chart below.
The trend in the spodumene concentrate price doesn’t appear to be the friend of lithium investors
The trend in the spodumene concentrate price doesn’t appear to be the friend of lithium investors
Keep in mind though, trend followers are always wrong at the top and the bottom! So while the strength of the current trend leads me to believe lower spodumene concentrate prices are most likely in store, there’s no reason we don’t print the exact low today and never look back.

Smacks of the uranium commodity price cycle​

On the last point, I am reminded of similarities between the current lithium price cycle and the recent uranium price cycle. Since Adam was a boy, commodities like lithium and uranium have experienced boom and bust cycles.
Commonly referred to as the “commodity price cycle”, it describes the process of scarce resources rising in price during times of increased demand. Often demand suddenly explodes for whatever reason (e.g. Tulips are pretty, everyone wants a Tesla etc.) causing prices to skyrocket. Speculators looking to strike it rich often push prices exponentially higher.
The lithium carbonate price appears to show traits of the commodity price cycle
The lithium carbonate price appears to show traits of the commodity price cycle
The massive increase in the price of the commodity stimulates greater production of the commodity as companies engaged in its exploration and development enjoy easier access to funding. Those companies not engaged in exploration and development of the commodity drop what they’re doing, retool, and start engaging in exploration and development of the commodity!
Long story short, often we end up with a supply glut which dutifully ends the price boom. Often, the price falls so far it becomes uneconomic to produce the commodity, which causes many producers to scale back production (i.e., Core Lithium), and others go out of business completely (let’s hope not!). At this point, supply declines and sets the market up for the next commodity price cycle!
Uranium appears to be in a different part of its price cycle compared to lithium
Uranium appears to be in a different part of its price cycle compared to lithium
Uranium’s fortunes have turned after the exact commodity price cycle described above played out since the Fukushima Nuclear Disaster in 2011. This is not meant to be a discussion on uranium – I have written several articles on this for you to investigate – but it does beg the question: When will the lithium price cycle turn?
On this, I draw upon a chart I recently saw on Market Index’s sister site Livewire, in an article by Mark Gardner from MPC Markets. Mark suggests the market for lithium minerals could remain in surplus until 2029. From there though, he notes a combination of increasing demand from the EV industry and an acute lack of long term production would likely swing the lithium minerals market back to substantial deficit by 2030 which could get “ugly”.
mark%20gardner%20lithium%20market%20dynamics%20to%202030.png
Source: Mark Gardner available from: (VIEW LINK)

There are many similar charts of near-term surplus / long term deficit for lithium minerals, and as a student of markets for over thirty years now, I fully expect the lithium price cycle will turn eventually. This means we will at some stage once again read headlines about booming lithium prices. The problem in my experience is, the turn may come after many investors have given up and moved onto the next shiny new commodity price cycle!
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Colombian stocks starting to rip.

If you have access to the US stock market, the GXG ETF isn't a bad start.

You could also buy EC (oil) and CIB (cheap Colombian bank).
 

Short sellers crowd lithium companies to start year​

But some of the country’s biggest hedge funds are saying conditions are still tough to make money betting against stocks.
Jemima Whyte

Jemima WhyteSenior reporter
Jan 7, 2024 – 5.08pm
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After a challenging stretch for short selling, lithium companies have begun this year among the sharemarket’s most bet against stocks as prices for the battery metal sink and concerns increase that some will be left undercapitalised and unsustainable.
Half of the market’s top 10 shorts are lithium-focused explorers or producers. Among the other half are uranium developer Deep Yellow, which has an $800 million market capitalisation and hasn’t yet raised capital despite the commodity’s run, and $4.3 billion travel group Flight Centre, according to data published by the corporate regulator.
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Pilbara Minerals operates the largest hard rock lithium mine in the country. The New York Times
But despite short-selling levels reaching as high as 20.75 per cent in the case of Pilbara Minerals – widely seen as a broader position on a falling lithium price – and above 13 per cent in Syrah Resources and Core Lithium, which on Friday said it was shelving its mine, investors who run long-short portfolios warn this year could prove challenging for people taking bets that companies’ share prices will fall.
“It’s not easy right now for anyone trying to short sell as the market is macro-driven, and we are in the early stages of a bull market. It feels like 2009 and 2010, when so many people were positioned for a correction which never came,” says GCQ Funds Management’s chief investment officer, Doug Tynan. GCQ, which delivered net returns of 52.5 per cent last year, can short up to 10 per cent of the portfolio.
At present, the fund only has about 2 to 3 per cent of the portfolio in short positions.​
“In this environment we expect to do very well investing in high-quality businesses at sensible valuations. Our focus is on companies with pricing power operating within favourable industry structures with secular growth,” Tynan says.
Most of his fund’s returns came from investing in “high-quality global compounders”, Tynan says, adding that short selling was an important part of the portfolio approach because it generated returns and also kept the team “sceptical and our forensic skills finely honed. Ultimately, this makes us better investors.”

Headwinds fallout​

Short selling is an investment strategy where an investor borrows shares from long-term holders with the expectation the share price will decline. The short seller then repurchases the stock at a lower price. Once the stock is repurchased, the stock is delivered back to its owner – who earns a fee for loaning out their stock – and the short seller pockets the profit.
Jim Chanos, the legendary short seller, shut his main short-focused hedge funds late last year, noting headwinds included low interest rates and meme stock mania. “It is no secret that the long-short equity business model has come under pressure and interest in fundamental stock pickers has waned,” Chanos told investors in November.
Blackwattle Investment Partners’ Ray David says his fund was among those shorting lithium companies.
“In the lithium space we’ve been active on both the long and the short,” he says.
“We’re long low cost, long reserve producers and short high cost, low reserve producers ... the longer the lithium price stays at these levels, valuations of lower quality high-cost miners will come under pressure, especially when these higher cost companies are burning cash, putting pressure on balance sheets. There is still an opportunity for short sellers.”
David says his fund was also eyeing “expensive defensives” – companies with high multiples and low-growth prospects – as potential short positions and thinks some supermarkets may fall into this category. He says in some cases, valuations hadn’t factored in rising costs in wages and rents, as well as the impact of a weaker consumer – which means more promotional activity and trading down to lower margin brands.
But like Tynan, David says long positions tended to deliver the most performance.
“Equity markets tend to be more optimistic. While we do short sell companies, we often take the funds and put them into high-quality companies with good management growth ... we’re borrowing from these position and putting the proceeds into some of our best ideas like ResMed, Carsales and James Hardie,” he says.
One local investor whose fund shorts shares says retail shareholder participation and a rising sharemarket created challenges for the strategy. A more resilient local economy had hurt shorters who had taken positions in local retailers last year, he adds.
But “concept stocks” – such as Weebit Nano, the market’s 12th most shorted group – with low revenue and high valuations tended to unravel over time, he says.
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