[largeruk]

I think that's just how large groups of humans work, in lots of areas of life, and the financial system is designed to control the majority and empower the minority. Humans are designed to follow the herd, believe in leaders, listen to authority, and take short-term gratification over long-term reward. And the stock market is a psychological trick played on the unwitting by the more powerful, which uses our biases against us. If you're of a certain anti-authority questioning mindset and understand some of the practices employed by the powerful then I think you can prosper in that environment

Would you mind expanding on that a bit. I'm as interested in the anthropological and psychological aspects of this as how it might affect one's trading mindset.

Thanks very much.

[petejh]

To answer that would take a very long time because you'd need to come at it from lots of different angles and have a working knowledge of how trading works at a technical level, and how different actors operate in the markets. But one angle to consider is how do people find an edge over average market returns, and how difficult is this? Having an edge is often an illusion, not many sustain an edge for very long. Here's an explainer but it's a bit technical:
https://twitter.com/therobotjames/status/1387216598331650052

The 'Citadel' he refers to are a huge market maker based in the US. They're the type of actor you'll be interacting with when you make a trade in a well-known company on one of the major markets. They buy the information flow from trading platforms such as RobinHood in the US, and make a margin by acting as the buyer/seller on the trades. It's institutions such as this that I'm referring to when I say the system is set up to empower the minority at the expense of the majority. Offwidth earlier in the thread lamented the information asymmetry and power imbalance in the markets and claimed the average private investor can never win against the 'big boys'. He's referring to these types of structures, and he isn't wrong per se - if you're trying to make money on the major markets in the well-known companies you're likely going to do no better than the average market return. And if you try short-term trading you're likely to lose. But what he fails to understand (because he probably doesn't have direct experience of doing it) is there are still highly speculative niche areas of the markets where it's possible to just be a geek and do lots of donkey-work of trawling through information and understanding the process, where the 'big boy' institutions don't really have much extra sway over the information and share price action because the market is too small - i.e. the low level of trade flow isn't worth much, and the fundamentals affecting value might be too technical for them to focus much of their attention on.

Other examples of finding an edge are more to do with the minutiae of how markets work - such as the monthly or quarterly rebalancing that goes on in tracker funds and how to take advantage of it.. this is the realm of quants (quantitative analysts) but can be learned by the average geeky private investor. Not of much interest to me but I have a basic awareness. Again, the smaller the index tracked by an ETF, the more information parity there is with the 'big boys'. 

Off the back of this information asymmetry in the markets, the 'big boys' have a view into what price levels private investors have bought into a share at, and using this they can and do manipulate prices up or down to play with private investors' emotions of fear or greed. That's what markets do to you - make you fearful of losing your money or make you greedy for more money. That's where the psychology comes in. It's difficult and requires faith in your strong research (or just innate patience or dumb blind faith!) to be able to behave counter to the way we're wired to react to losses and gains. Prices dropping should be welcomed if you've done your research, and rising prices should be times to be fearful and sell out. For a good description of investor psychology read 'The Intelligent Investor' by Benjamin Graham, the foundation of value investing. It explains 'Mr Market' and the irrationality and group-think that result from the fear and greed emotions.

It's a massive topic. People can and do find an edge just short term trading using chart technical analysis and an understanding of investor behaviour, they make small amounts of profit off the noise in the market. With discipline they can have a small edge but it's a full time task. Not for me. I'm into building an understanding of the fundamentals of something - for me it's mineral exploration, mining, biotech, and technology linked to the transition to low-carbon power and transport. 


I haven't explained that very well. Basically - the big insto's have the big markets zipped up and it's v.hard to beat the average market return (+ive or -ive). Find a subject in a relatively niche area that you enjoy learning about, learn as much about it as you can, and exploit it until the herd move in.

 

[Johnny Brown]

No, I think you've explained it very well, it certainly has increased my understanding, thanks. Whereas your original post read like a load of conspiratorial bollocks quite frankly!  I don't think humans 'are designed' for starters, and I'm not sure the markets were particularly either. I'd say both have arisen as consequences of largely random events in complex systems.

The statement that 'the stock market is a psychological trick' also seems a bit of a stretch. Your explanation goes a long way to clearing it up but would seem to be reliant on the ratio of private investors to 'big boys'. I don't doubt the markets get manipulated but do the private investors really hold such a large percentage of the market that they can be so played by the 'big boys'? (genuine question not rhetorical btw).

[petejh]

Yes, that was my lazy use of language. I often assume people know what I really mean, when they probably don’t.
Of course I don’t think humans are designed. ‘evolved to be’ would have been better language.

And yes, markets likewise - a complex system which has evolved in a certain way. Which powerful actors can exploit to their ends.

Yes the profit on private investor trading is huge. I’m out atm but do a search for Citadel and you’ll see their *profit* on PI trading flow is in the billions of dollars.

[Fultonius]

The reddit wallstreet bet team are at it again:

https://www.reddit.com/r/wallstreetbets/comments/o0kufi/arvl_the_second_transaction_to_reset_the_clock/

I've got some in at @ $19.62 (bought as a hunch that they have something to give the world), currently at $22. 44% short ratio (which is a warning I guess), so I'm strapping in to see if this goes all GameStop again!

[Ru]

Yes, that was my lazy use of language. I often assume people know what I really mean, when they probably don’t.
Of course I don’t think humans are designed. ‘evolved to be’ would have been better language.

And yes, markets likewise - a complex system which has evolved in a certain way. Which powerful actors can exploit to their ends.

Yes the profit on private investor trading is huge. I’m out atm but do a search for Citadel and you’ll see their *profit* on PI trading flow is in the billions of dollars.

The other thing you can do is invest in those companies that make money from the market.

[kelvin]

I just took a small punt on Filo, cheers for the nod Pete.
I've more money freeing up over the next week and I can extend that amongst other things.

Decided to use ii rather than Hargreaves like most of my friends - after a little play with the interface with it, my brain seemed to click with it better.

[James Malloch]

This is something I should probably know, but I don’t. Possibly because I’ve always traded big stocks (e.g. Lloyds).

For Cornish Metals, for example, there was a rise in SP yesterday and it’s moved up/down by small amounts recently too.

However my holding value has never changed as, I guess, the sell price hasn’t moved from 14.5p.

Can anyone explain why this happens to me please? I’m guessing it’s to do with it being a smaller stock which has a smaller market cap but don’t understand it really.

[petejh]

It'll be due to the margin spread between the bid and ask, i.e. the margin made by market makers between price to sell versus price to buy. For small companies with low liquidity the spread is normally larger than for large companies with a very liquid market. For e.g. https://www.lse.co.uk/SharePrice.asp?shareprice=CUSN&share=Cornish-Metals
(btw the LSE chat forum can be a useful source of information for some companies but utterly awful cesspit of arguing for others, tread carefully).

If you go on your HL account and do a 'dummy sell' - i.e. start the process to sell your shares but don't make the final step - then you should receive an accurate price that HL will offer you for your shares, which can be higher (or lower) than the spread advertised when you do a simple google of the share price. Just be careful making dummy trades as there are countless stories of people selling accidently!

edit: btw I noticed in today's RNS from Cornish that the first batch of drill results for United Downs will be reported 'imminently'.. 

[James Malloch]

Cheers Pete, that makes sense. Doing a dummy trade showed the actual price up. 👍🏻

And yeah I noticed their update. Hopefully it’s soon, and positive!

[petejh]

Cornish Metals released drill results today. They only released assays for the first of seven holes and left the carrot of the remaining 6 holes dangling with some suggestive positive narrative in the report. The first hole is positive with some narrow widths of very high grade copper and tin that add confidence to last year's results. But the meat of the information is in the remaining holes. Looking good here and looking forward to seeing the remaining 6 holes.
Report here, including photos of some impressive native copper (pure metal, not combined ore) core intercepts from a new copper zone discovered in pending hole 7. https://www.cornishmetals.com/news/2021/cornish-metals-reports-resultw-from-ongoing-united-downs-drill-programme/

Alphamin & Filo (among others) remain no-brainer holds. Filo hole 46 (the 1500m hole) expected mid-July.
 

[petejh]

Also an updated broker note today for Cornish from Hannam&Partners. They obviously like what they see in that first hole, updated their target price to C$38c (22p). Haven't had time to read the note yet. Full note here: https://cdn-ceo-ca.s3.amazonaws.com/1ge8fha-Cornish_Update_060721.pdf

[petejh]

Ilika (solid state EV battery manufacturer) announced a capital raise of £25m on Friday by offering new shares at a placing price of £1.40, significantly diluting the current share price. Offer closed within hours. As a current shareholder I'll be taking up option to purchase at £1.40 on the open placing.

Money to be used to accelerate development and scale-up to commercial production of it's goliath EV battery. Its miniature solid state battery Stereax, for use in medical implants and industrial sensors, begins commercial sales in early 2022.


https://www.lse.co.uk/rns/IKA/proposed-placing-open-offer-and-retail-offer-864ismq99acompl.html
Background to, and reasons for, the Capital Raising

''Ilika is a world-renowned independent expert in the design and manufacture of solid-state batteries.

Ilika has patented expertise in solid-state battery materials, cell designs and processes for manufacturing. There are a number of sectors where original equipment manufacturers ("OEMs") are interested in accessing Ilika's solid state battery technology to power their products. These include EVs, industrial sensors (otherwise known as the Industrial Internet of Things or "IoT"), medical technology ("MedTech") and consumer electronics.

Designs of conventional large format lithium ion cells are reaching their maximum theoretical energy density of 300-350 Wh/kg. Solid state cell designs offer the promise of theoretical energy densities of 475-525 Wh/kg depending on the choice of architecture and materials. Developers around the world are designing and making prototype solid state cells that are gradually increasing in energy density. These new designs are expected to yield energy densities that will exceed conventional lithium ion cells in 2022 and move towards the theoretical limit of such designs over the next five years.

Solid-state cells have a number of environmental benefits over traditional lithium ion cells. Currently, only 5 per cent. of lithium ion cells are recycled and yet they are environmentally harmful due to liquid electrolyte toxicity and the risk of fire and explosions. Traditional lithium ion cells cannot be landfilled or incinerated. In contrast, solid-state cells present no risk of explosion from a flammable electrolyte and commonly available process technologies can be used for recycling, including the oxide electrolytes preferred by Ilika's cells.

In March 2020, Ilika completed an over-subscribed £15 million equity placing, allowing the Company to support the implementation of its Stereax manufacturing scale-up in its own manufacturing operation based within four miles of Ilika's headquarters. This is expected to result in a 70x increase in Stereax production capacity by the end of 2021. Following product qualification, initial product sales are expected in the first half of 2022. Substantial progress has been made towards the completion of the manufacturing facility, including factory acceptance tests for key tools. To date, the Company has spent £2.5 million of the £4.0 million total expected spend on fabrication facility implementation. Once the technology transfer into the manufacturing facility has been achieved, Ilika's business model will continue to be to sell Stereax batteries, although some parts of the manufacturing workflow will be managed on an outsourced basis. The manufacturing facility will be capable of processing 3,500 wafers per annum with an expected revenue generating capability at peak capacity of £12 million per annum. In order to manage the scale-up in production, Ilika hired a Technology Transfer Director in 2020 and is hiring a team with relevant industrial experience. A further step-up in production capacity with a larger manufacturing partner is expected to be required further into the future, when a licensing model may be more appropriate.

In September 2019, Ilika announced the opening of its new large format battery facility, the Goliath pre-pilot line, in Romsey, UK, to support its portfolio of industrial collaborations. On this pre-pilot line, Ilika is developing low-cost printing processes suitable for forming batteries several orders of magnitude larger than miniature Stereax batteries. Establishing this facility formed part of the activities covered by the scope of three Goliath projects being carried out on a collaborative basis with the support of the Faraday Battery Challenge, which is managed by Innovate UK. The three projects supported the production of A6 format composite battery structures by the fourth quarter of 2019, followed by continuously improving cell designs which delivered greater than 100 cycles without failure and conversion efficiencies greater than 90 per cent. by the fourth quarter of 2020. A reproducible baseline manufacturing process was established by the first quarter of 2021.

Given the accelerating demand and addressable market for EVs, underpinned by government policies, scaling Goliath presents a large opportunity for the Company. The Company's Goliath technology development path is aligned with the EV revolution currently taking place, as annual sales accelerate to meet international commitments to reduce carbon emissions. The Company is able to utilise the experience gained from its Stereax technology to help with the scale-up of the Goliath programme.

According to International Energy Agency data, after a decade of rapid growth, in 2020, the global electric car stock reached 10 million, a 43 per cent. increase over 2019, and now represents a 1 per cent. share of all car stock. Battery electric vehicles ("BEVs") accounted for two-thirds of new electric car registrations and two-thirds of the stock in 2020. OEMs are expected to embrace electric mobility more widely in the 2020s. Notably, 18 of the 20 largest OEMs (by vehicles sold in 2020), which combined accounted for almost 90 per cent. of all worldwide new car registrations in 2020, have announced intentions to increase the number of available models and boost production of electric light-duty vehicles ("LDVs") and more than 10 of the largest OEMs worldwide have declared electrification targets for 2030 and beyond. The development path for Goliath batteries is aligned with this market growth. BloombergNEF expects that production of solid state cells will ramp up steadily from 2028 and that, by 2035, they will account for nearly 50 per cent. of total EV batteries in Europe, amounting to 150 GWh of production. Solid-state batteries are expected to reach price parity with conventional lithium ion cells the year prior to this in 2034.

The adoption of EVs is being driven by legislation around the world in order to reduce carbon emissions and tackle climate change. The EV industry has a roadmap to improve the characteristics of batteries. In the UK, the Automotive Council has published a set of market needs, setting out the improvements in the principal characteristics required to 2035 and beyond. Solid-state batteries have the promise of being able to deliver performance improvements aligned with the industry EV roadmap over and above what the incremental improvements in traditional, liquid-electrolyte-based lithium-ion cells are expected to deliver.

Ilika expects that the initial commercial adoption of its Goliath technology will be led by high value consumer appliance applications such as beauty products including hair straighteners and curling tongs, power tools, cameras, e-cigarettes and medical devices, which can also benefit from some of the unique properties of solid-state batteries.

The three Goliath projects, supported by £5.2 million grant funding to date, are enabling Ilika to interact with leading companies in the UK automotive sector. In the PowerDrive Line project, Ilika, as the lead partner, is working with Honda Europe and Ricardo to develop battery modules that can be charged in under 20 minutes. As part of a consortium led by McLaren Automotive, Ilika is participating in the Multi Optimal Solutions for Energy Storage Systems project to develop battery systems for performance cars. The consortium considers that current electric technology is not sufficiently mature for the demands of high performance cars due to high weight, range limitations and battery management challenges. Through the development of new materials for cells and a modular-designed battery, the consortium aims to deliver the advances it considers are needed to achieve improved levels of functionality and performance. Ilika's third project, Granite, for which it most recently received an award of funding from the Faraday Battery Challenge, is being led by Jaguar Land Rover and is designed to assess the compatibility of Ilika's process with established lithium-ion production techniques. The Goliath programme is closely aligned with UK government industrial strategy and is supported by government bodies tasked with encouraging the UK's EV industry, including the Faraday Battery Challenge.

In April 2021, Ilika announced it had partnered with Comau, part of the Fiat Group, and a world leader in the industrial automation field, to scale up Ilika's existing Goliath pre-pilot line and deliver a plant design for a Goliath manufacturing line at a mega-scale facility. The design study is being supported by the Advanced Propulsion Centre (APC) over the 12-month project. The project, which is led by Ilika, has two objectives, firstly to design the scale up of Ilika's existing Goliath pre-pilot line to increase production of solid-state cells from 1kWh per week to 10kWh per week until the development of a pilot line, targeted by Q1 2023 . Secondly, following the signing of a framework agreement with the BIC in September 2020 for the production of Goliath solid-state pouch cells, Comau will undertake a full study of Ilika's processes and deliver a plant design for a megawatt scale solid-state manufacturing line for ultimate installation at a facility such as the BIC. The target of this stage of scale-up will involve Ilika reaching 5 MWh per week by 2024.

£10.0 million of the net proceeds of the Placing are expected to be used to fund the development of Goliath technology through targeting and exceeding LIB equivalence around December 2022, £5.0 million of those net proceeds is expected to be invested in increasing the capacity of the Goliath pre-pilot line from 1kWh to 10kWh per week, targeted by Q1 2023. In addition, £2.0 million of those net proceeds will be used to strengthen the balance sheet and provide additional working capital and to support the Company's planned Goliath product development until mid-calendar year 2023.

Following product development of Goliath technology to LIB equivalence, the Company plans to further develop Goliath technology until manufacturing readiness in 2024 and the planned subsequent transfer of production to a mega-scale production partner facility (i.e. one that produces MWh per annum of cell capacity), such as the BIC, to help facilitate its manufacturing scale-up targeting a further 500x growth in production capacity from 10kWh to 5MWh per week, in line with the framework agreement entered into with the BIC. The Company will require further funding to facilitate the development of Goliath technology until manufacturing readiness and the planned move of production to a partner facility. Following LIB equivalence being reached, however, the Board believes there will be a range of funding options available to the Company, including strategic partners, government grants and additional equity financing.

Ilika is currently experiencing demand from OEM customers and their direct suppliers ("Tier 1") for prototype cells for evaluation. Ilika expects to generate revenue for the sale of evaluation samples from pilot line production, particularly for consumer appliance applications. Revenue is expected to ramp up significantly to c.£70 million per annum once Ilika's process is established at a mega-scale facility, initially from the sale of cells into consumer appliance applications, followed by the automotive sector. Assuming the transfer of Goliath production into a mega-scale production facility commences in 2024, annual revenues of £50 million from the consumer sector supplemented by an additional £20 million from the automotive sector are expected by the financial year to 30 April 2028. Further growth in revenue beyond that is expected from licensing. Ilika's forecast is made up of expected demand from a portfolio of around 62 OEMs and Tier 1 companies.''

[Adam Lincoln]

So i did a load of work that i was paid in Euros for. When i took job i was £35/40 a day better off on the amount. It was a 3 month job so not an insignificant amount.

Its sitting in a starling euro account at moment. Anyone care to have an educated guess as to if the euro will get stronger anytime soon or if i should cut my loses? Dont need the money really so happy to let it sit but dont want it to dwindle any lower.

[Ru]

Anyone care to have an educated guess as to if the euro will get stronger anytime soon or if i should cut my loses?

No idea what will happen. Hedge your bets and convert half of it to sterling.

[petejh]

No idea on the likely euro/pound relationship over next couple of years but the US dollar is odds on to weaken. If you don’t need the money perhaps keep it for a US trip..

[steveri]

Personal recommends for a low cost broker?
I had an SVS account ...who went bust and eventually handed over to ITI - who seem quite amateurish and are now frozen having been told to sort themselves out. I won't be doing a ton of trades, so low management annual/charges and simple UI would be good. Other than that undemanding!

[petejh]

I use II but they're not the cheapest if trading infrequently. Here's a comparison table.

[Adam Lincoln]

Thanks guys. Yeah think ill convert half and keep half for Spanish winters.

[largeruk]

I use II but they're not the cheapest if trading infrequently. Here's a comparison table.

Could you please sort the link - nothing displays for me. Or it might be me?!

Thanks

[petejh]

Does the picture work for anyone else? (works for me on chrome)

[largeruk]

Does the picture work for anyone else? (works for me on chrome)

That's weird. I'm using Chrome but can't see it .

[remus]

Looks like the pic is from Google photos or something like that? Might not have sharing turned on, or Google might be doing something to stop ppl embedding the image.

[petejh]

Here’s a link to site with a handy comparison table if you scroll down.
https://www.koody.co/investing/compare-the-best-investment-platforms

[steveri]

Got it, and thanks for covering for lazy googling skills