Member Info for StarBright

Another classic example of how US & UK market practices & regulation differ...

There is no need for users of the mainstream UK investing platforms to worry about their shares being lent to shorters. And there is absolutely no need to set sell orders in the way Napthman1 suggests.

Here’s why. None of the major/reputable UK retail platforms lend investors shares. This is clearly stated in their t&c’s. Some examples:

Halifax 10.10: “We will not lend or deposit by way of collateral any investments in your account to a third party”

Hargreaves A25: “Investments will not be lent to a third party and we will not borrow money against your investments.”

Barclays 13.1: “ We will not engage in stock lending for any Asset in your Account.”

Continental quoted $600 for 250k oz/yr in their Jan’ 20 Buritica presentation. Adding a bit to that makes sense, so $712 looks reasonable to me.

Islandgirl - yes, you are right that there are many many unknowns so it’s often not possible to generate high confidence in valuations. However, the processes of valuation - for example looking at comparatives and reviewing the output of commonly used metrics - provide a great framework for understanding what really matters when looking at a company. The valuation journey is often more useful than its output.

Pops1980 - price monitoring extensions occur when the closing auction process throws up a UT that differs from the last recorded trade by more than a certain %. It’s essentially an opportunity for the RSP’s to have another look and re-bid if necessary. It’s basically an automated operational technicality, and has no particular meaning for investors.

Clearly I’ve hit a sore spot there...

bhargav, if you look back at the discussion on valuation from last week you will see that I didn’t articulate my own thinking on valuation. Rather I tried to play DevAd on what was being posted here. I tried gently to point out that:

1. OMI’s economic interest (that should be used for LT valuations) is not 100% of project economics. Degsy (sorry MasksNewNorm) and others were very keen on asserting that OMI owns 100%. This is/was misleading; deliberately so.

2. GGP’s peak “42% of in-situ reserves” valuation seems unique to the circumstances there. It is WAY outside the envelope of comparatives (I gave a range based on Edison’s sector research) so should be viewed with caution.

3. That if the metrics applied in the Zijin/Continental transaction next door were repeated, the valuation implied for OMI was very different to the numbers being proposed by the more excitable on this site.

These points were obviously not popular with all those roaring on the SP, and the discussion wasn’t welcomed or (frankly) progressing. So I gave up, and posted this on 17th:

“...what I was trying to do was to provoke an evidenced debate on valuation methodologies. I’m not wedded to any one in particular at this point. But “because GGP” isn’t enough for me. It’s evidently not the week for debate though! I’ll wait and enjoy watching the crew hard at work here. When it has all died down there will be a better opportunity for those looking to discuss rather than simply to “get the herd over”.“

I’m hoping that better opportunity presents itself soon. These boards are valuable when used for the exchange of information and ideas - particularly so when those exchanges take place between people with professional experience of mining and investing, and those such as yourself with deep knowledge of the company.

OMI not on IG’s list. Not the current list anyway.

Bhargav - you spent the week before last telling everyone that 40p+ then 50p+ was imminent. The price is now 26p. Your expectations were unrealistic. I know that you are a committed long term investor - and I share your optimism for the future - but please don’t try to airbrush history. This was pumped to high heaven last week, and your voice was prominent alongside the pumping crew roaring it on. It’s all there in your post history. The crew has moved on, and the unrealistic expectations built too early into the share price are nothing more than (another) transient spike. What matters is that the price today isn’t overheated in the same way. OMI is a much better investment proposition as a result.

SP got over-heated on unrealistic expectations and associated ramping, but then corrected. Good value now below 30p. HTH.

Of course your standard-issue LSE conspiracy loon would propose that TP are trying to give their clients a few days to get in cheap before news lands...

“experts”..? I hope you’re not referring to TP as experts on valuation...

It also has to show how one or more of the projects can be commercialised effectively. This precisely what Bill and his colleagues do. Their opportunity to add value is in execution. Whilst the much-heralded commodities super-cycle provides a useful tailwind, it will never be enough in itself to prompt a re-rate. That will come from successful exploration and project development work. Exactly what they are doing at present!

TKIA - TP have basically valued what's known, and then applied an exploration discount. I think that's ok, but it needs to be understood for what it is. The opportunity for UFO is to come up with evidence that there is more to these projects than was previously understood. For example, the Mexico silver projects could easily be updated in terms of g/t AND the exploration discount reduced over time. Thus UFO has significant upside potential. It just has to do its job as an explorer, and prove that there is more in the ground at some of its projects than has been shown before.

My initial thoughts are that the figures they have for the Silver projects look very low; I will look more closely at these. Hamersley is included at a higher number than I had suggested, apparently because they've gone for an 80% exploration discount (I effectively had 90%). But £30-£60m not the £300m-£1bn proposed here last week. Donovan2 I find hard to evaluate, so will look at what they've done.

I think it's really helpful that they have published this. We'll all have a view on what they've done, but it should make for a more useful discussion than NT to buy...

Yep. And that is with some substantial exploration discounts in the valuation.

Interesting SoP valuation. £41.5m to £82.9m, that's 1.2p to 2.4p.

I will take a closer look and comment later.

You've got to be kidding!. The entirety of issued shares have been traded 3x over in the last few months. They've had the big grass box on, and having been mowing the spread risk free thanks to the frenetic activity of the PI's on this board and elsewhere. It's been a dream share for them. I would think they love it.

Lol!

V excited to see regulatory recognition of the special contribution made by degsiecolumbusmasksnewnorm...

I thought - given frequent discussion here - that some UFO investors might find this fund launch interesting:

https://citywire.co.uk/wealth-manager/news/amati-launches-strategic-metals-fund-for-top-resources-team/a1470802

“At launch, the fund is expected to be comprise of 50% gold, 20% silver, 15% speciality metals, 10% industrial metals and 5% in an exploration basket, while on a regional level 35% of the fund will be invested in Africa, 25% in South America, 20% in North America, 10% in Australia and the remaining 10% in rest of world.”

Not clear whether 20% silver (sorry, siliver..) means exposure to the silver price one way or another, or exposure to the equity of silver miners. Perhaps they’ll hold UFO at some point???

Not a plug. I am not involved / connected!

MM’s will have a view on where stops might be, and they might (occasionally) probe at quiet times to test their hypotheses. But they absolutely do not access to data on where stop orders are on retail platforms. They can (obviously) see DMA orders, but then so can anyone who has L2 access.

To address a few recurring LSE myths:

- MM’s don’t “want your shares”, they want your trades because flow = money for them
- MM’s can’t “see your stops”, because this would be a breach of numerous regulations
- Your platform (assuming it’s one of the main retail ones) doesn’t lend your shares for shorting
- MM’s don’t control whether your trades are reported as buys or sells
- MM’s don’t use 1-share trades etc to signal to each other

I could go on, but that’s enough for now....

UK regulation prohibits payment for order-flow, so the original point about RobinHood selling data isn’t relevant here. UK regulation is - in many ways - different and more protective than US where retail is concerned. Don’t read the stuff on Reddit etc and assume it applies here. Most of it doesn’t.

I can’t see any evidence of shorting. I think we just have an absence of buyers. Volume is low.