Member Info for Theorist

Robbieishere, just to correct you TR1 notifications are a legal requirement under DTR5. These notifications are never made for the purpose of ramping the price. Furthermore you cannot use nominee accounts as a way of circumventing this requirement as some have suggested. Not sure where you have been getting your information from, maybe you have been confused by the fact that the Tr1 is also a share transfer form?

Hogsnipe commendable post! I guess from an investor viewpoint its actually a disappointment in the sense that the rally in the Pensana share price is clearly not attributable to any positive news or actions by the company, it is merely reflecting general market sentiment re the sector. Would you agree with that conclusion?

If the CEO is right and abandoning the BFS to concentrate on FEED was a good decision (IMO absolutely stark raving bonkers) where is the finance?? For over 15 months the company has been scouring the markets, from China to Norway ad no doubt many places in between. And what has it come up with? Nothing, absolutely nothing. What does that tell you? Why should that frighten the hell out of investors? The company's now desperate position has put it in a shocking negotiating position and it's going to get totally scalped. You can just see it coming (though maybe not on this chat line).

Some extraordinary posts here. Takeover by GE! No mention in the budget! Fact is that at the moment all Pensana has is some scrubland in Angola and £10m in the bank. No finance for a mine, no BFS, no feed for Saltend, I think the up-rampers are getting very carried away. Fact remains with no finance this is still a venture teetering on the brink. Jam tomorrow, tomorrow, tomorrow until the last syllable of recorded time!

Agree with what you say. That’s why larger investors place fill or kill orders, recognising that there could be multiple vendors satisfying one order. When liquidity is poor the matching engine may be simply unable to fill the order. The point I was trying to make to Hogsnipe is exactly yours, ie reverse engineering day by day pretty fruitless and invariably the wrong conclusions are drawn, eg somebody is stake building, shorts are clearing out etc. One thing is for sure, this company has to deliver on financing and ATF within the next four weeks or it could be carnage.

I think it is incredibly difficult to draw meaningful conclusions from the type of analysis you are conducting. First, as you know, every AT trade is both a buy and a sell and the transaction is reported as a buy if the price was above the mid price and a sell if below. So when you analyse the AT transactions it is irrelevant if there were more sells than buys or vice versa. Second, not all transactions have to be same day reported. Some larger transactions might not be reported for three days. Third you have to imagine the MM’s as holding a float. They have to make a market at all times, that is there duty. So at times they will buy in and hold stock. They don’t want to do this so they make sure they shift or minimise the stock essentially by adjusting the bid/offer. Fourth the liquidity of a particular stock, especially a company like Pensana, is going to be highly variable. Sometimes, even in the last month, I have seen bid/offer spreads of over 6p, on one occasion nearly 9% of the bid price. That is ridiculous when you consider that most investors are happy to make 9% in a year! But what the spread tells us is that the MM’s are struggling to match buyers and sellers, liquidity is poor. AT transactions are low because volumes and liquidity is low, O transactions higher as MM’s step in. This can happen obviously at different points in the same day. O transactions will always tend to be higher value per trade than AT because with low volumes and poor liquidity it is more unlikely that the computers will be able to find a match from someone wanting to buy or sell a block. If fo example you set a limit order to buy 100,000 Pensana at 88p the order could sit there unfulfilled for ages. If you broke it down into several trades one or more will probably get filled straightaway. It is the poor liquidity that throws up the odd sets of numbers that attract your attention. Having said that days of high turnover always attract my interest, particularly if there has been no company announcement . The bid/offer spread is always interesting too, for me it is in fact everything because I make money by trading the beta, in other words I don’t care whether a stock goes up or down, I just like it to be volatile. I don’t trade Pensana because I don’t like the company and I have not an earthly clue what the share price is going to do from one day to the next or even one session to the next. It’s one best left To LT investors IMO.

Hogsnipe/Tornadotony, I have a genuine suggestion for you both which I hope you will take the right way. I can see you spend a lot of time trying to understand the physical side of the market but a lot of the conclusions you draw from analysing trades and trends are not correct. There is a fantastic book, the only book, it is Trading & Exchanges, Market Microstructure for Practioners, by Larry Harris. it does have an American bias but that doesn’t matter. Some of it is very technical, some of it an easy read. Every serious investor or trader should study this book. It is expensive but you can get copies off eBay for as little as £40. It will be the best £40 you spend. You might hate my posts but you’ll thank me for this one!

Mumbles, bit strong questioning DP’s intelligence considering you bought Pensana at 150p. There was a point when Liberum thought Berkeley Energia we’re going to punch the lights out. I sense a bit of deja vu. You can of course get your 150p back but you’ll have to sell 2 shares to do it!

Hogsnipe I can tell you exactly why Pensana are outside of the ATF/grant loop. First they are struggling to get finance for their mine. I think this is partly because they have a very weak management team, partly because of the highly unconventional approach to obtaining finance and part because of the Angolan risk. In addition I know people are alarmed by the company’s reporting. Everything they announce is “spectacular”, “world beating”. A bit like Boris’s track and trace. It is very boastful, in your face. Government officials don’t like that. They like plodding LCM, university research geeks, as you said. There are some like you who actually believe that one day Pensana will recycle wind turbine binnacles. Unfortunately government doesn’t buy that guff. In fact until and unless the company gets their mine operational they must wonder what on earth Saltend is about.

Horizonte a very different arrangement. Jeremy Martin is hugely respected and the financing turned on an initial placement and the key support of the export credit agencies. These together effectively contributed $160m of equity or junior debt into the financing and for the true senior debt slice the rate as you quote was Libor plus 4.5% or so. It doesn’t help Pensana’s cause that within weeks of the placement the shares are down 40%, that is a very weak signal to potential investors and lenders.

Mumbles, you could buy shares in Imperial Brands and trouser a dividend yield of 9%. You can buy shares in BT at a PE of 7.5, an implicit yield of over 13%. There are many house builders at PE’s of sub 8. In fact there are many Uk listed companies (and no doubt many European) that are trading at very low multiples. It would be easy to assemble a portfolio that would yield well over 10% over time and actually carry very little risk. You think someone will lend the money to Pensana, a company with no track record whatsoever, at 8-12%? To finance the construction of a mine in Angola? There would have to be a massive sweetener, which would obviously come at a big price for shareholders. These are the reasons why the share price is so fragile.

Tornadotony, I am sorry but I have to say your naivety is stunning. Do you really and honestly think that Pensana is going to get a loan priced at say Libor plus 2,3,4,5% ?? The finance risk is colossal, as we know the company has not been able to attract finance at any rate and has turned its hopes to the Norwegian bond market. Would you lend the company money for a return of less than 20%?? Pensana’s gambit of seeking to raise finance on Feed rather than BFS is almost unprecedented. I think doomed to fail but we shall see. I don’t always agree with Dumbpunter but in this instance he is spot on. The fragility of the share price is a reflection of the market’s concerns about the company and its strategy. It has nothing to do with shorters, bots, downrampers, etc etc, all the nonsense that China and others peddle.

SunDrum would that be you??!

Tornadotony I think you are missing the point. Whatever the Feed the fundamental issue remains, the issue being who is going to finance a mine in Angola when the company itself has no equity to speak of and the senior management has no track record. And when I say no track record I mean no record of success, indeed rather a record of failure. If this was a Glencor or an Anglo then maybe the finance would be available. But it isn’t. The board is lightweight. It is very short on experience of execution of mining projects in hostile locations. This reality is dawning and that/ is why the share price is tumbling. No question it is heading into the sixties, possibly even lower.

China. I know that you are north of 65 but you have to accept that times have changed and markets have become more sophisticated. Investors have choices. They can make money from shares going up and they can make money from shares going down and have a vast array of financial instruments at their disposal. People who bet on a share going down are not villains or criminals. You have to absorb this fact and calm down. You also need to understand that Pensana would be very difficult to short, first because of the lack of free float and second because of the huge spreads on cfd bid/offer prices.

China, you must, must develop an understanding of shorting. Yes, shorting can drive the price down, particularly if it is large scale. First, as you often like to point out, over 80% of the Pensana stock is held by the top 20 shareholders. So even if shorting was taken place it would by on a very small scale and the impact on the share price would be minimal. Second, the shares sold short have to be bought back, so the impact on the share price is minimal. Third, shorting is not immoral or criminal. Some people make money by betting on the SP going up, some by betting on it going down. It is all no more complicated than that. Shorting is not the reason why the Pensana share price has fallen 60%. And no one is going to be arrested. Everything you post on this subject is utter rubbish and you are making yourself look a complete fool by persisting with your nonsense.

China you have been saying the shorts are going to get burned since the share price was around 140p. It has nearly halved since then. And of course it could be heading for something well under 50p. You clearly like charting so you can figure that for yourself. You might be a little optimistic in your hopes for a sudden reverse.

No

This is becoming almost comic. 100 baggers, take overs, we’re getting the full Monte from China and family. And the share price? 78p!

SunDrum. I am sorry but you are hopelessly out of your depth here. Your post is so utterly stupid, probably the most childish and ignorant I have ever read. China and yourself just do not grasp the very basics. You need to go away and learn about nominee accounts. In the interim just stay away and stop wasting everyone’s time.