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THIS LANDSCAPE IS LITTERED WITH THESE THINGS
SOME ONE WITH ACCESS TO A LARGE GOLDBUG DATABASE SPINS A STORY IT ENDS UP IN YOUR INBOX AND ALL HELL BREAKS LOOSE
THEN THE INEVITABLE FLAMEOUT INTO OBLIVION.
WE HAVE ALL FALLEN FOR ONE OF THESE HAVEN’T WE ?
MANY ARE STILL HOLDING THE BAG…WAITING FOR GODOT.
Who’s Next ?
Thank you for presenting these charts together.
They provide an interesting lesson, but I’m not sure which one. With one possible exception and 2nd near-exception, I would have thought on the basis of the charts alone that each was buyable. Or at least if I were for some reason to believe that the company had some sound fundamentals (such as good management, good property, potential ability to finance itself) I would think the company potentially worthy of a purchase as a speculation. In each case if I were told it was a PM company in a good jurisdiction etc etc in the current environment, someone (including myself) could use the chart as evidence for purchasing shares. In fact, I own one of the companies with mild enthusiasm and own two as interesting gambles. One of the charts I see that I personally find most attractive is associated with what I suspect to be an egregious near-scam.
I do not know whether the lesson is about my chart reading abilities or about my judging of these companies or what.
Follow-up on conversations on one of these, BSX: Otto at IKN while irritating and not always be correct can yet be informative. He recently pointed out, in keeping with the general tone of your observations, on how poorly a recent recommendation of BSX served those who rushed out to follow it: https://incakolanews.blogspot.com/2019/08/checking-in-on-john-doodyporter.html
I will probably bore people in repeating myself but I don’t think it’s a matter of inevitability but more of probability. The vast majority (VAST!!!) of these companies will go up and then go back down, true. The charts are probably legitimately pointing to the likelihood that even the trash flies into the air with strong winds and that the winds are starting to pick up. Relying on the charts may mean little more.
Buying and holding typically means taking immense losses (whether realized or not) after the share prices come back down. However it is not exactly a matter of inevitability.
For one thing, there are companies with decent managements and properties that can persist in somewhat healthy condition through more than one cycle and end up getting bought out at a high price eventually. I have with a mixture of ineptness and luck myself hit minor jackpots by holding on to a couple of such companies for too long, through more than 1 cycle.
More important, once in a while one of these companies really does extremely well, typically by getting bought out rather than building a mine. Other companies can do fairly well by serially vending decent properties. True, it is remarkably stupid to assume any given company will succeed, or that even a given small portfolio will have one such company. However with a mixture of luck or knowledge and care, one can have a portfolio of companies that contains 1-2 big winners and several others that can survive a bad downturn — along with others that go bankrupt, have to dilute badly etc.
Charts alone are not enough for the best odds. Knowing more helps. I and most of us unfortunately do not know anywhere near as much as the pros, and most of the pros aren’t spreading the knowledge efficiently.
Thanks for posting.
Seen all and suffering from karma. At least at the right place not to repeat the mistake of past.