There’s No Easy Money!
Gossip: “Casual reports about other people, involving details that are not confirmed as being true”.
In my retirement years, I find I’m tuning into financial information left, right and centre and checking my super balance almost daily. I’ve never been much of a punter, either at the races or the stock exchange.
Being risk averse maybe doesn’t provide the highs of a big win yet it also means I don’t endure the lows of losing those hard-earned dollars. Jumping up and down hugging perfect strangers across a crowded room and being a Melbourne Cup winning owner packing a suitcase full of cash does have some appeal – just once to know what it’s like.
However, a prime example of my conservative approach was earlier this year; a charming barrister gave me a tip on a company listed on the stock exchange which was as close to a sure thing as one could get. The company, Allgate, listed as ACN on the market. I mention his occupation as it gave credibility to his tip as opposed to advice coming from a local barista.
Allgate’s story is interesting – an Australian gold mining company whose mining leases were confiscated by the Thai Govt in 2011 preventing them from mining in Thailand. That’s 10 years of no income. Yet a year or so ago Allgate challenged this action in the World Court and the matter was finally settled in favour of the miner.
In the lead up to this decision there was much speculation with savvy investors buying in. It appears the King of Thailand wanted the gold for himself not some Australian company, and the World court supported the Aussie miner.
The actual date of handing back the mines has been set, yet it means rivers of gold will flow. The temptation to buy shares was attractive and I sought the counsel of my sister. Big Sis being the one to turn to for advice and didn’t miss the mark this time. “Only buy what you could afford to lose” were her words which still echo in my ear.
So, I bought 1200 or so shares at 98c and then again later a further 2,200 at 1.70 ish. Yesterday on the eve of an announcement the share price moved to 1.99. Then today an announcement Allgate could resume mining within a month. The news couldn’t be much better.
However, the fickle stock market didn’t see it that way and the shares fell to a 1.69 – go figure. The share price is now bobbing around 1.42 per share. Proof there’s no sure thing in gambling and one needs to be careful in listening to financial gossip no matter who it’s coming from.
I felt crushed.
p.s. My mate says some hedge fund is artificially keeping the share price low so they can buy more of them. Pays to be in the know, yet really is what we know really in the know? I really didn’t have the faintest idea.