Member Info for Paul2566

I think the spread is simply reflecting that there are not many shares changing hands. Not much being bought, and those holding seem to be, well, holding on to them. This is creating a liquidity issue.
This means the Market Makers risk complete transactions that cause the market to move too much, so their risk in transacting any trade is relatively high.
The wider spreads help to mitigate that to some degree.
I don't think its anything to be concerned about, potential buyers are awaiting some positive news, and potential sellers are awaiting the same news in anticipation of better profits.
I am not saying the above is correct, it's just my take on it.

There were a few unusually large buys over £40k yesterday, a little unusual for PIs, and a little small for IIs. Even if it was an II buying in batches I would have thought adding them together is still a bit on the low side for an II.
As far as I can tell they look like ordinary trades. I'm not saying this means anything of importance, I'm just curious.

Casting a quick eye over yerterdays trades.
By volume; Buys = 247,070,963, Sells = 198,140,822, Unknown = 17,727,427.

Even if I atribute all the 'unknowns' as sells, there were marginally more buys than sells. Yet it finished below the opening price. The market does all too often defy logic.

Picked up a few more late yesterday, now holding a little over 11.1m shares.
Lets see what the day brings.

Laverda
I hope it dips again to give them a chance, I have been there myself in the past and its a nuisance. Its never nice to see PIs lose out.

I suspect a lot of stop losses were hit, there will be a lot of surprised folks looking at their screens today after receiving trade notification emails.

My holding just dropped by £13k, nothing has changed, its just a number on the screen.
It was always possible there could be a delay.

onlyking
I hadn't forgotton the IIs, there are some already, but still many who will not be able to take a position in KOD due to internal policies. Of course I have no way of knowing what the SP will do, but my suspicion is that around the magic number we will see a drop back to the mid .9p area. I suspect this is where the IIs may well take a bite of the cake to push the SP back somewhere over 1p. To myself I'm not too concerned with the SP falling, as long as there is no bad news driving the move. Shares go up, shares go down, what matters is the long term trend, and I believe its up.
I would much prefer the SP to simply drift higher, it would certainly give me that warm feeling of comfort, but when a SP falls, I just determine what has changed, has the reason I invested changed, if its nothing then its just a number on the screen and means little unless personal circumstances should force me to sell.

Laverda
To be honest, I've not really looked at the potential gold assets. I am aware of their existence, but view the priority as getting something out the ground, and a start of cash inflow. This will be a huge change in my assessment of risk. KOD put the gold on the back burner with a view to generating cash from the lithium, and it appears to me that BA has made some very astute decisions to get us where we are. I suspect he had already decided that to find a JV deal to suit our needs the Lithium would provide the best leverage. I see the lithium as the main play at the moment and do not have the knowledge to estimate a maiden value of the gold at Nielle. It will undoubtedly add to the value and its always a bonus to not be a 'one trick pony'.
As I understand it the gold is of a high grade and BA believes it can be recovered in a cost effective manner.
KOD appears to have control of some nice assets, and with BA at the helm I have my eye on a prize far greater than 1p.

ELSteve
I agree with you over the short term, I think for many the magic number may be 1p, and there will be many selling and happy with that short term rise from around .35p. Lets face it, thats a nice short term profit. I agree that its likely to fall back a little at some point just past 1p. Its not my plan to cash out, although I did stick £23k in here that I had meant to allocate to another stock, but I expect that to be fairly stable for a while, and even then its never going to shoot up or down for that matter, its just not that type of stock. I have my eye on a price not far from that magic 1p where I will free up that £23k to move into the other stock. As for the rest, I think, depending on how things play out it may well remain in KOD for the next 5 years and beyond.
I first bought KOD at .25p but only a very small entry under £500. It put a little skin in the game, made me keep track with its progress and allowed me to buy as I felt more comfortable with progress and risk. I've added all the way up to my last buy at .867p. Its brought my average up to .5p but I can live with that.

ELSteve
Thankyou for the reply, that makes perfect sense.
You are correct in your assesment that I am no trader, I just don't have the skills or the nerve for it. I'm not even convinced that I could aquire either skill / nerve.
I tend to have brief moments of good luck that I'm going to call skilled stock picking, split by long periods of average stock picking that I prefer to view as bad luck. I have most certainly paid for my own financial education with many mistakes along the way, and yet I still make them, just not so often as I used to.

Sorry the 'induced to sell' reference should have been in response to the thread not you directly.

ELSteve
I don't doubt from what you have disclosed that you have more knowledge around what goes on. Perhaps I put my view badly.
There are a couple of stocks I hold where I have such faith in the business model and fundementals, that if the SP were to drop by 90% in a day without there being some sort of black swan event, I would buy every single share I could, and I could not as you put it be induced to sell.
I'm not a professional but have been dabbling in the markets for around 30 years, I have made many mistakes including investing in the next bright shiney make me a million tomorrow stock with little or no research, and those lessons have been expensive but probably necessary. KOD has been one of my riskier investments but everything I have seen gives me the confidence to hold what I have. Its not going to make me a million overnight, but I can smell a nice profit.
Given your background I would genuinely love you to share some of your knowledge. That sounds like i'm taking the mickey, but I really like to hear from people who know what they are talking about.
ATB

ELSteve
I'm afraid on that point we will have to agree to disagree.
If I have done enough research I should have faith in the stock, if the price falls, I just smile and increase my holding. If I have bought stocks that I haven't done enough research on, I don't have the confidence to weather the inevitable fluctuations in the SP so I sell.
Ultimately it is the investor who decides when to buy and sell.
I do feel a bit sorry for new investors who set stop losses at inappropriate levels, I have myself been caught out once by this. When I checked I had exited a position on an unusual dip that quickly recovered. It was a costly lesson.
I don't see it as personal on behalf of the MMs, its just market forces, nothing more.

Laverda
I think we agree how it works but I just kept it simple, mainly because I like simple.
How to manage a mass sell off, I'm not certain what they do but if it were I acting as the MM I would simple drop the BID to deter selling which would allow me to increase the spread to cover my risk. If there is a mass sell off it shouldn't be a problem aquiring stock.
Conversly if there were no takers on the BID, I could increase the BID and decrease the spread, and/or increase the OFFER.
I'm not sure I have put that very well, but hopefully its clear there are several permutations that can be used to influence the market to a degree. Of course it does not always work as can be seen with some of the burst bubbles in recent history, and it can take a bit of time to regaing some sort of normality.

I must admit I don't understand why the price is doing what it is on the volumes I'm seeing, but there will be a reason.
MMs get the blame, but ultimately they act just like a any shop/market stall etc.
They buy stock in at a price, add on their profit margin (the spread) and sell.
Obviously they have to sell at a higher price than they buy at.
If they have sufficient stock in hand to supply demand they can afford to reduce the BID price, as they are not desperate for stock, likewise if no one is buying at the OFFER price they can reduce the BID and OFFER prices to maintain margin.
Ultimately they can also increase the margin to accomodate additional risk so they don't end up with large holdings of stock they cannot shift.
I can only assume that at the moment they are holding plenty of KOD stock to meet demand, so are not desperate to resupply, hence the low BID price.
I don't think there is any more to it than that.
Ultimately if as I think is the case at the moment, more volume is being taken as OFFERS than replaced by BIDS, eventually market forces will cause and increase in bothe the BID and OFFER.

Daz
I guess so. Selfishly I'm hoping it drops a little more to end of play tomorrow. I don't have any further investing cash left after my purchase yesterday, but should have another £3k from dividends after midday tomorrow. I may put it here, even if only short term.

There seems to be a lot of people scraping change together to buy whatever they can afford. Mostly nickle & dime trades, and I get that, investing what you have spare. Everyone cannot afford substantial trades.
What I dont get is the odd sell here and there, nothing really of note. But why on earth would you sell now, if its to trade the volume of those sells is never going to work, especially so with the current spread.
Perhaps some just have bills to pay and they are on the limit with no other choice.
Unfortunate because now is probably not the time to sell.

flyfishery
No problem, thanks for getting back to me.
I welcome other views, so I can consider their merit, and re-visit my assessment of the situation.
I'm not planning on holding this latest batch of KOD shares long term, only because I'm way overweight in this one stock, but I see the opportunity for a short term small gain. If all goes to plan I will off-load 2m shares at my target price, which I hope will be reached over the next month or two.
atb

flyfishery
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