Tuesday, May 26, 2009
Sell Macquarie Bank into the rights issue. As of yesterday (25th of May) ASIC kindly allowed the shorting of Australian financials and we saw a healthy drop across most of the majors. I think the trade of the month has to be taking a short position in Macquarie Bank in anticipation of the rights issue which goes live on the 12th of June. Eligible investors will be allowed to purchase up to $15,000 worth of MQG.AX at $26.60 per share and I'm sure at the time of the offer, when Macquarie was trading at $33, most investors who took up the opportunity were doing so with a view to locking in a decent stag profit. MQG is hanging around the $31 level today and I think selling here with a view to buying back on or around the 12th of June at the $27 level is a smart trade.
Monday, May 25, 2009
Coalworks.AX is currently undertaking a Bankable Feasibility Study for their Oaklands North Project near Albury. They are trying to prove up a 750 million tonne thermal coal resource. Thermal coal is used to power coal fired power stations and if there's one thing that people need to turn the lights on it's thermal coal. As the Global warming hysteria dies down and people realise that coal is cheap cheap cheap compared to other forms of energy, Thermal coal will be the new new thing. It's just started running hard, from 18c to 25c today (as at 1320hrs), there are approximately 100million shares outstanding. You don't have to be great at maths to realise that 750 million tonnes of thermal coal is worth a little more than $20m....
Suncorp has been much maligned for a long time now and it seems nobody can really figure out if it's a bank, an insurance company or an investment manager and the share price has been savaged as a result. If you ask me, and nobody usually does, this business will begin to make a lot of sense once it's broken up. Any of the big four wanting to beef up their QLD credentials would have a lot to gain from taking out the banking division and there must be an insurance company that wants to take some cyclone and flood risk.
Monday, May 18, 2009
After a 20% run in month, where can the stockmarket possible go but down? The smart money must be getting short. Unemployment, despite recent figures is rising, business investment is down. The aussie taxpayers have been lumped with about $3000 each of Rudd government debt. I'd have thought it was a fairly simple trade to get set short and wait for at least a 10% retracement. Shorting of financials should end on the 30th of May and once that happens it seems likely that financials doing massive capital raisings (Macquarie Bank) will come under significant pressure. If it's trading anywhere north of $30, then sell sell sell.