Sunday, January 9, 2011
Angel Mining Black Angel Mine just featured on BBC2 "Arctic with Bruce Parry"
Just been watching BBC 2's "Artic with Bruce Parry". Brucy spent some time in the summer of 2010 with Tim Daffern (resigned to be CEO of gold miner Hambledon Mining (HMB) in September 2010) at the Black Angel mine owned by Angel Mining (ANGM) in the Disko bay area of Greenland. Tim confirms that there are reserves of $1 billion of lead and zinc with1000 pillars of $1.5 million dollar zinc seams. The programme shows the building of the cable car entrance to the mine. Interesting stuff!
I hate it when the markets are closed
I'm waiting for the markets to reopen tomorrow with great anticipation with the news due from Xcite Energy and Bowleven. Even if RNS's aren't forthcoming on Monday, then its only a matter of time.
Things are nicely primed for positive share price action. I took the decision to close some of my CFD (contracts for difference) positions on Friday and open spread bets on IG INDEX instead since this strategy means any large move up in Xcite will mean no capital gains tax liability. CGT is now 28% for higher rate tax payers and I don't fancy handing over a third of my Xcite gains to the Inland Revenue. On September 2011 spread bet positions the premium was pretty reasonable late on in the week for Xcite. Annoying though that the deposit requirements on both Xcite and Bowleven are high given their AIM status.
A lesson I've learnt with both CFD and spread bet trading is to leave plenty of deposit in your account to avoid any problems if things go wrong and they start closing positions for you because of margin calls. Before the 2008 stock market falls, they used to call you to tell you to deposit more funds. Now they just close them without informing you. I can imagine there were a lot Rockhopper investors caught out when the "flash crash" happened last year and there margin was exhausted when the price collapsed only to be in utter dismay when the share price recovered. This is why I do not use stop losses on AIM stocks, the volatility can be so enormous that you can be caught out whilst you're in a meeting or getting a coffee! Juggling things to maximise your position but leaving yourself some security in case things go wrong can be a tricky balance.
Things are nicely primed for positive share price action. I took the decision to close some of my CFD (contracts for difference) positions on Friday and open spread bets on IG INDEX instead since this strategy means any large move up in Xcite will mean no capital gains tax liability. CGT is now 28% for higher rate tax payers and I don't fancy handing over a third of my Xcite gains to the Inland Revenue. On September 2011 spread bet positions the premium was pretty reasonable late on in the week for Xcite. Annoying though that the deposit requirements on both Xcite and Bowleven are high given their AIM status.
A lesson I've learnt with both CFD and spread bet trading is to leave plenty of deposit in your account to avoid any problems if things go wrong and they start closing positions for you because of margin calls. Before the 2008 stock market falls, they used to call you to tell you to deposit more funds. Now they just close them without informing you. I can imagine there were a lot Rockhopper investors caught out when the "flash crash" happened last year and there margin was exhausted when the price collapsed only to be in utter dismay when the share price recovered. This is why I do not use stop losses on AIM stocks, the volatility can be so enormous that you can be caught out whilst you're in a meeting or getting a coffee! Juggling things to maximise your position but leaving yourself some security in case things go wrong can be a tricky balance.
U.S. earnings season kicks off on Monday
Aluminium producer Alcoa (aa.) kicks off the Q4 U.S. earning season next week and expectations are high with most analysts pencilling in average S&P 500 earnings growth of 30% plus. So the markets should be particularly dynamic next week on both sides of the Atlantic. It seems unlikely that companies will miss their earnings from 2010 and therefore expect some positive momentum in the DOW and S&P 500 which will spill over to Europe.
There is so much to worry about though, the rise in commodity prices will inevitably feed back into higher inflation so interest rates will have to start rising eventually. The combination of rising interest rates and stagnating growth isn't a particularly enticing concept to look forward to. I reiterate my point again that 2011 is about stock picking and trading not buying and holding.
There is so much to worry about though, the rise in commodity prices will inevitably feed back into higher inflation so interest rates will have to start rising eventually. The combination of rising interest rates and stagnating growth isn't a particularly enticing concept to look forward to. I reiterate my point again that 2011 is about stock picking and trading not buying and holding.
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