[kelvin]

Interesting you mention CVR Partners Pete - seems to be lots of noise about this one and I do have a small position already. Seems to be plenty of upside for the next six months or so but like anything else with the war ongoing, a recession looming, governments making odd decisions everywhere... anything past six months is a guess.

Today I parted company with Itafos Inc (fertiliser), bought 14 March and left with a 36% profit. Also sold K&S (fertiliser) for a 22% profit, bought on the 8th March. CVR looks like it has more upside going forwards than these two, so I'll put some of those funds there.

Elsewhere, big thanks to Pete for the nod to Filo - I spent an evening this week running through all the latest news, updates etc and I'm happily to keep letting this one ride. Lots of people thinking to take profits at $20, completely understandable but I honestly don't know where I'd put them and feel as happy on a risk/reward basis.

Currently, it's all going okay. Made some rubbish decisions at the start and that's cost me dearly. The maxim being don't lose money and I lost far too much but slowly getting there. This thread was invaluable, all of the links have been useful, as is the #mintwit community on Twitter and I feel like I've turned the corner - I'm currently up 38% since I started in July and it feel like I've got the basic beginner mistakes out of the way now.

Cheers to everyone who posts, especially those who's comments have tempered my overexuberance in new endeavours.

[petejh]

Doing well with +38% in less than a year, especially if you started with losses. Last year was a bull market so not a great deal of stock-picking skills needed to make money but this year (and likely the next few years) will likely prove harder to make profits in the market unless you're in the right things at the right times.. not an easy thing to get right in volatile markets with lots of noise distraction.

Here's a wealth preservation tip for anyone owning commodity companies in a rising trend right now..
Learning some basic charting will prove v.useful for helping to stay focussed and not getting ruffled by volatility. A useful tactic for stocks in strong uptrends (pf flex incoming..)  i.e. many oil/gas companies, Alphamin, Filo, MLX, Centauras Metals, Mosiac, CVR Partners, Altius Minerals, Glencore, Whitehaven, GGP (until they weren't).. is to zoom out on the timescale to observe the monthly timeline - continue holding shares in strong uptrends until price closes below the 12-month moving average. Sometimes price will spike down through the 12 month MA on an intra-period timescale, but not close out the period below the 12MA (hence may continue rising after you may have sold out). For the really committed there are lots of other signals you can learn to help stack the odds in your favour of identifying when uptrends and downtrends are ending, but price crossing the 12MA is an easy one to spot for anyone. You can get tradingview for free to do this. 

Happy days with Filo, it's been almost a complete zero-brainer since April 2021 - simply the best large-scale copper discovery to be invested in. All you need to do is hold and it will be higher over time. It will dip, like everything dips, there'll come a point once it hits the 20s where the early birds will start selling (i.e. me, I'm up over 400% now and it makes up 20%+ of my portfolio so I'll slice some profits above 20 while keeping a position for the very long-term). So I'd expect slower growth above 20 in theory due to rotation out for the early ones and rotation in for the next group of investors e.g. longer-term instos and later to the party pi's. One of the next catalysts, other than drilling results, is Filo getting added to the GDXJ index. The index rebalances quarterly and the last rebalance was March 19th. When this happens then the Vaneck fund will buy a large number of Filo shares on the market. Happened with GGP in autumn of 2020 and various other explorers that hit big. Not guaranteed Filo will get added on the next rebalance but it's an inevitability sooner or later.
Exploration-wise to explode again would take a step-out hole away from the hole 41 area showing a second high-grade zone. That's far from guaranteed, the good thing is it doesn't need to be as the resource is only growing over time and it's still early. The only real long-term uncertainty with Filo is whether it goes 1.5x from here or 5x.  That said they're still awaiting Argentine fiscal stability agreement and there's still the results on the arsenic to come out to determine processing cost impact. I suppose the world could end.. But the world's biggest copper discovery in recent years at a time copper is entering the early stages of a bull market due to a once in a lifetime transition from hydrocarbons to renewables, requiring more copper than ever before, in an historically underfunded copper exploration market, is a once in a lifetime opportunity.   

I mentioned UAN back in early February as the fertiliser company I wanted to invest in but couldn't (about the only share II won't let me buy). Instead I bought MOS (nitrogen and potash ferts) and ALS (royalties on potash mining). Looks like it's going to continue to do really well - the value calcs are in the link I posted (below). On top of strong share price growth it's going to be paying a very chunky dividend this year (% currently unannounced but high double digits?).

Another value play that I'd love to invest in but can't is UAN. At least I can't invest in my ISA, I think I could over the phone into my general account but can't be bothered with the CGT that will likely result. It's a US nitrogen fertiliser company called CVR Partners (ticker UAN). They're benefitting from higher prices in the US market but also a number of factors coming together at the current time, including the current nat gas price hikes in Europe making fertiliser imports to the US more expensive, and unrest and sanctions in Ukraine/Belarus/Russia shutting down nitrogen fertiliser exports from those areas. Check out this value thesis underwritten by a large dividend, with a double (or higher) in sp growth thrown in. It's quite compelling:
https://plumcapital.substack.com/p/uan-plums-best-commodities-play

Since I sold my two UK tech losers and rotated the funds into oil, coal and ferts they've all been doing well (bought Occidental the same week as Warren Buffet bought $4billion on the market, Altius Minerals, Mosiac, Whitehaven and Glencore the others). Although I notice some signs of life in Illika - government supposedly releasing their delayed energy strategy imminently, maybe that has something to do with it. Battery storage an essential piece of renewables growth but the solid-state tech still only moving forwards slowly towards scale up. 

Polarean came out of their 6-month hibernation yesterday with a 25% tick up on news that they resubmitted their new drug/device application to the FDA. Remember this is the company with the polarised xenon gas imaging technology, used with existing MRI's and which allows superior imaging of damaged lung tissue. Well worth researching them it's great technology, being used in various lung-function studies currently underway in UK, Europe and the US.
They had their application knocked back by the FDA in October last year for some supposedly minor issues related to manufacturing (hence tanking by 50% on decision day). A decision on the reapplication is expected within 6 months, expect on October 1st to see this either go to interstellar space or to crash and burn. Large uncertainty but if successful then price will likely multiply many times as this is a v.big deal commercially and they'll almost certainly get taken out by a big player. Not one for putting a lot of money into as it's completely binary, success/failure is in the hands of the FDA. (I have 1.5% of pf). Last year in the lead up to FDA decision the price went to £1 on investors buying in anticipation. Price currently 65p. Once bitten twice shy? Or will people think there's a higher likelihood of success second time around.

[petejh]

Examples illustrating the pattern of obeying the 12MA in an uptrend. Note these aren't recommendations at this point in time (except Filo) as I got in early to some of these companies (the latest being Glencore, WHC, MOS, OXY and ALS). They'll all stop rising eventually, some perhaps suddenly.   

All are monthly timescale, blue line is the 12MA (red the 36MA). I think I'm correct in saying that in each case once price closed above the 12MA at the beginning of the uptrend, it didn't close a period below it until present day. Price spiked down to the 12MA intra-period (notice the narrow 'wicks'), but the MA provided support.
GGP rode the 12MA and then you can clearly see it closing below, and commencing downtrend. It's currently hugging the 36MA for dear life (to me the evidence suggests it's now turned, but I could be wrong).

[kelvin]

Thanks for 12MA guidance, I'll have a look later and play about with it - just about able to read a graph now!

Regarding UAN - ii happily let me buy it on my laptop in my trading account but won't let me buy it on my phone app and certainly not in my ISA which I really don't understand. I've had a few times this year we're ii hasn't let me have access to things that are on the TSXV, which is nonsense when I have lots on there already.

Just did a quick check of this year's Q1 and I'm around 29% up, which is staggering to me, I only had the goal of beating ISA interest when I started.
 There have been losers as well tho (I'll possibly sell these two next week) in Visibility, a data harvesting point of sale company which I still think has got a great future and Powerhouse Energy Group - a wonderful hydrogen set up that can turn plastic waste into hydrogen power. I'm around 50% down on both but would happily bag hold if I had to. I still have some Scottish Mortgage on a 20% loss but will start adding to monthly once the new tax year starts, although I'm expecting that to drop much further this year.

[sdm]

Here's a wealth preservation tip for anyone owning commodity companies in a rising trend right now..
Learning some basic charting will prove v.useful for helping to stay focussed and not getting ruffled by volatility. A useful tactic for stocks in strong uptrends (pf flex incoming..)  i.e. many oil/gas companies, Alphamin, Filo, MLX, Centauras Metals, Mosiac, CVR Partners, Altius Minerals, Glencore, Whitehaven, GGP (until they weren't).. is to zoom out on the timescale to observe the monthly timeline - continue holding shares in strong uptrends until price closes below the 12-month moving average. Sometimes price will spike down through the 12 month MA on an intra-period timescale, but not close out the period below the 12MA (hence may continue rising after you may have sold out). For the really committed there are lots of other signals you can learn to help stack the odds in your favour of identifying when uptrends and downtrends are ending, but price crossing the 12MA is an easy one to spot for anyone. You can get tradingview for free to do this. 

Investing.com uses Trading View's charts and data but their free version has fewer limits than Trading View's.

Blocking their ads is recommended if you have a low tolerance for annoying popups.

If you really want to go to town on charts, Koyfin is great for the markets that they cover in real-time.

[sdm]

Pete (and others): What's your general strategy regarding taking profits/holding on if a junior mining stock shoots up to crazy levels on a short term basis?

If they haven't yet reached your calculated valuation but are looking very frothy in the short term, do you hold on to your entire holding or do you look to take some profits as momentum tails off? (potentially looking to buy back in after they have pulled back a bit?)

[petejh]

You'll probably be unsurprised at my reply: without knowing more information I couldn't give one answer or general strategy. Other than the standard - wealth preservation is important for long-term portfolio growth, whilst every really large gain made in mining shares involved large drops along the way. Rarely large reward without commensurate risk.


To give a better answer would need context. The main factors I'd be considering are:
1. what stage of development are this company at? Are they a junior explorer with a few early discovery holes, many exploration holes, an extensively drilled-out project, a development stage company with a PFS/DFS and permitting in place, are they fully-financed for the capex, a company approaching first ore, or are they a producer.
2. what's their market cap? What does this price them at on a Enterprise Value per-ounce/per-lb basis, or an EBITDA multiple if they're producing? How does this valuation compare to other similar companies in the sector.
3. what's the company's share structure and cash position? Do management own significant shares? Other institutions invested? Are there options and/or warrants outstanding? If so when are these likely to hit the market. Any pre-IPO shares held in escrow? How much cash do they have, how much do they need for the next stage in progression? When is a raise likely?
4. what's the geology and minerology? i.e. what type of deposit is it? What's the potential for resource growth and is this priced in?
5. what's the jurisdiction? Is it high-risk or low-risk.
6. what's the commodity price doing - is it high, low? What about the outlook. What are the long-term drivers of commodity price and what are the risks.
7. what's the market sentiment and sentiment in this sector currently?
8. what are the technicals on the chart suggesting?

Sorry if that's not very useful.

The above factors and more would help me decide firstly what % of my pf I'd invest, and what my hopes and expectations were and what timeline.

I could give concrete examples for different companies but it would be a very long post.

[Fultonius]

I see First Tin has done it's IPO and is available. Good play?

[kelvin]

I see First Tin has done it's IPO and is available. Good play?

My own feelings are inflation might do for them, a bit like it has for Tungsten West. Still only invested in Alphamin for tin and they are asking for offers for the company currently, so at some point a move to MLX looks on the cards.

Well, it's been a few mad weeks with big drops most weeks and a recovery. Feels like I'm learning a lot and still managing to hit an ATH every week this year but I'm being ruthless at cutting things when it feels time to. I tried having a look at Trading View and it's going to take me a while to get fluid with that but still finding it easier to follow 20 and 50 week averages with ii. There's definitely value to be had, certainly when it come to timing purchases and sells. Most of the time it feels like I could have done better.

Been cleaning up my portfolio a little recently with the goal to hold some more cash.
Sold my last Pantheon shares, overall up 61% and although there still a great chance of a rerate upwards, I felt I was happy with that.
Sold out of ZACA with a 27% profit, didn't feel right and then they plummeted back to almost my purchase price.
Sold of out Tungsten West with a loss of 6% after they announced they were halting work at the mine due to inflation.
Sold out of Horizonte Minerals, had watched them for ages but not committed and then an opportunity for a day trade came up whilst I was on holiday. Paid for lunch.
Day trade on Tullurian gave a 5% profit. (bought with FOMO and sold when my sensible head took over)
Sold out of Millenium PMs for a profit also, can't remember what tho.
Oh yeah, sold Meridian for a small profit also.

Sold half of my FILO and then bought most of them back inside my ISA, keeping those for the long term but still need to make up my mind when to sell the others. A complete no brainer this one.

Sierra Madre is ticking along nicely at a 30% profit. Plenty of money to drill, no warrants (that makes a change) and insider buying ongoing.
UAN/CVR Partners as Pete recommended is also doing quite well, even after Thu and Friday's blood letting.

Had my first dividend from Franco Nevada - bought this as a long term hold with my sensible head.
Started monthly investing in Anglo Pacific on the LSE

Also bought some Whitehaven Coal down in Aus, they're going to have plenty of cash to divi out this year and since the multifuel stove on the narrowboat of our main source of heating, that's my hedge for domestic bills.

Still not keeping much cash but do have a plan and can move to 30% cash quickly. Expecting recession.

[petejh]

Was going to post on here over the weekend but just a quickie. Overall market sentiment will always beat fundamentals - that's how value is created and that's what we're seeing this week with high quality companies getting sold off along with the garbage. Always happens. Some investors who either need to move to cash or who need the cash to pay losses in a tanking market - institution and private - have to sell no matter the long-term quality of the company. Some amazing opportunities due to the drops in Filo and  Alphamin currently, no apparent fundamental reason for the drop in AFM and it's now trading at an insanely low multiple to forward earnings - one of the best value play out there as noted by Value Situations, and now also a special sit with a buy-out potentially in play: https://twitter.com/ValueSituations/status/1524120849984503809.
Filo, prepare to be amazed is all I can say. All you need is patience. The drill assay released after market hours yesterday shows bonanza grades despite being terminated before reaching target depth. It extends the volume of the hole 41 area by huge amount of tonnage and changes the understanding of hole 41 feeder zone. Up 18% in Stockholm market this morning (Lundin family s Swedish and they list on the local market as well as Canada). Drops in these companies are massive opportunities for those with steady nerves and good research. Easy for me to say as I'm up many hundreds of % in both, but I'll be buying more on the open if I can get a decent price.

In case that all sounds too positive I should add that, overall, this market is a great place to be out of and just sitting on the side-lines with cash waiting for bargains to appear from the wreckage. Could be a long wait.

I see First Tin has done it's IPO and is available. Good play?

Absolutely not. I read their prospectus pre listing and decided against at the listing price of 30-odd p. It was overpriced then, now in this inflation environment and this market sentiment they're toast until things recover imo. All the miners, even the largest most efficient like Agnico, are suffering margin reductions due to higher input costs. And all developers are having to revisit the capex estimates within their PFS/DFS studies. The absolute worst place to be in the market right now (apart from unprofitable tech) is a junior resource developer with a out of date Capex estimate trying to open a mine for a commodity after the mania for tin has subsided (for now...), in Germany with all its energy woes (I know thy also have the mine they're trying to open in Australia).  That said if they tank some more I could be interested. Both sentiment and fundamentals are against them.

[petejh]

There we are, one market close later and a 30% day for Filo (7.5% for AFM). Can't keep stories like these down for very long even in bear markets. Hope someone took advantage.

[kelvin]

There we are, one market close later and a 30% day for Filo (7.5% for AFM). Can't keep stories like these down for very long even in bear markets. Hope someone took advantage.

Yeah, quite the day that Pete - good news and a bounce in the market combined made for a big day.
I didn't benefit as sold out all my Filo a while before, I'd doubled my investment and wanted to buy some other things and have some cash (my partner has Filo also, so still sorta involved) but did bid at CAD17 as it was so low. It went even lower but I didn't get any and then it jumped. If it drops again this week I might bid again.

Also sold a huge chunk of Alphamin at CAD1.08 and bought back at 99c - used the profit to finally enter MLX at AUS 51c. That all worked out perfectly apart from Alphamin going even lower to sub 90 before rising. Happy to finally be in MLX. Tin price is dropping currently but the long term thesis is still there.

Mostly in cash currently, around 70%, and waiting patiently and if I'm honest expecting to wait a while for the true bottom.

Used some of that Filo cash to open a position in Vertex, a small refinery company in the US who make diesel out of used engine oil. Bought in at $9.88, doubled my position on Thu at $12.44 to 10% of PF and then watched it rip over 15% on Fri. There's a bit too much talk, almost like a pump and dump but the fundamentals look good currently - I may jump half back out of this later today, in expectation of another fall in equities this week at some point but that might be completely wrong! Not advice that's for sure.

Like Pete - trying to be sensible and stay mostly cash, waiting for bargains. The portfolio is much better balanced now that Filo isn't 50% of it and Alphamin and Vertex are currently at 10% each.
Expecting another volatile week, hope everyone is playing safe.

[petejh]

Approaching midpoint of the year. With US markets firmly in bear market territory I reviewed my portfolio to see how it's holding up year-to-date compared to the indices.

Due to events everyone is by now familiar with - high inflation, Ukraine/Russia, Fed tightening, interest rate rises, continued supply chain pressures and market sentiment shifting out of tech/growth - in March I finally got interested enough to invest in oil/gas and coal for the first time in 20 years of investing. I also invested in US fertiliser producers and base/precious metals royalty streamers - as inflation doesn't impact royalty company margins to the extent it does the producers, who have to pay higher input costs of production (and thus lose some of the margin leverage) in inflationary periods. I sold 2 of the 3 tech stocks I owned for a loss (Illika and Trackwise).

The premise behind choosing US producers was that they were less exposed to divesting Russian assets, lower (perceived) risk of having windfall taxes levied against them, and less exposure to high costs of production - e.g. high gas prices for European fertiliser production. This worked well, and I sold after 2 months for small gains in Occidental, Exxon and Mosiac (fertiliser). I could have held and sold higher but gains are hard to come by in this market, so I'm happy to take gains and move it to the safe harbour of cash. Interestingly, Biden announced last Thursday that the US gov will shortly begin attempting to impose windfall taxes on US oil/gas producers, though it looks unlikely to get through congress and senate.

The investment case for Australian coal appeared compelling in March and I think it remains so. A look at the forward price for Newcastle coal helps illustrate. European countries had to pivot away from using Russian coal for power generation and steel-making and start purchasing coal from elsewhere. 'Elsewhere' includes Australia,. This increase in demand for non-Russian coal has recently been compounded further, by those European countries most exposed to reliance on Russian gas for gas-fired power generation needing to come up with solutions to the issue of replacing Russian gas. These nations have now started starting up mothballed coal-fired power stations held in reserve to provide a temporary uplift in generating capacity - Germany, among other nations, is reportedly dusting the cobwebs off redundant coal-fired power stations for a capacity uplift while it tries to retreat from reliance on Russian gas.

It doesn't take a macro genius to see the pressure points and macro commodity/energy dynamic that Putin is trying to exploit here with his cuntery, and the problems he's forcing on the west right at a moment in history when the west is trying to make a once-in-a-century energy transition away from fossil fuel to renewables and which had to involve willingly downscaling its own short-term fossil fuels energy resilience as a (completely necessary) part of that process.
Putin.. what a piece of shit eh. This is why we can't have nice things (yet).

Meanwhile, the usual demand for Australian coal from China and SE Asia for power generation and steel production remains strong. That’s the demand side for coal.

On the supply side there, there appears less potential for short-notice scale-up of extra coal supplies hitting the market than there is for oil/gas. The declining coal price over the last decade and withdrawal of capital due to ESG policies has resulted in a lack new mine construction, hence there not being loads of spare capacity. It takes years to construct mines. This picture of fundamental supply/demand squeeze is before you start getting into any gains from frothy investor sentiment moving into what it perceives as a trending theme. I’m assuming the strong coal price is a 1-2 year price cycle playing out, and my guesstimation is the coal price has more strength behind it than the oil price, for reasons outlined above, also because coal has flown under the political radar compared to oil/gas, maybe due to people not filling up their cars with lumps of magnetite and delivery/production costs not linked much to price of coal. It matter not for producers, a price rise is a prise rise and a producer's margins are leveraged to whatever the commodity price.   

If I'm right then there’s still a gap between what has so far been priced in for certain coal producers, versus the profits those producers are generating and may continue to generate – i.e. plenty of upside still to be had. This is partly a result of the bargain-basement valuations that the major coal producers are rising up from after a decade of declining share prices and being shunned by investment capital like autistic kids at a party.
If I'm wrong, then the last quarter and next quarter's revenue is still off the charts; a decent capital gain will have been made; and free cash flow will still be distributed to shareholders in the summer.

Hopefully this dynamic is relatively short-lived, while Europe figures out how to transition away from its reliance on cheap fossil fuels for electricity generation and especially fossil fuels from belligerent fascist states. Because, while I’ll take profits from this inevitable market reaction to a global supply/demand dynamic created by an asshole exploiting short-sighted policy choices of western governments, I’d much rather the west was further along the road to transitioning to low carbon renewables and coal/gas supply shocks weren't still the gamechanger they currently are. But we are where we are, and this energy price environment is going to happen whatever your politics. So while Australian coal producers are rising from the grave like a zombie in an ESG nightmare, and generating huge profits like it's the 1990 again, I'll use that market and try to profit from the companies profiting. It might cover my increased energy bill...
 
Australian producer Whitehaven has benefitted from coal’s price rise. The company is currently generating turnover of (Aus)$2bn per quarter of Aus$2bn, with EBITDA of around $1.5bn per quarter, on a market cap of only $5.5bn. This is a very low ratio… and market cap was 25% lower when I bought in March. This enterprise value-to-EBITDA ratio compares with a typical range of between 4 to 15 enterprise value x EBITDA, depending on sector. (Some profitable tech companies have ratios in the 30s – Amazon averaged 33 x enterprise value to EBITDA from 2017-2022.)
Even at a suppressed enterprise value/EBITDA multiple of 2 - 3 typical of the coal sector since ESG mandated withdrawal of capital, Whitehaven is still under-priced on current earnings. The company is debt-free and in the process of share buy-backs, with further buy-backs expected to be announced at August earnings. I'll continue holding in the expectation of further capital gain and what's estimated to be a large dividend of 12-20% on my original investment. Dividend and further buy-backs to be declared at August earnings. One that Simon might want to investigate on his value hunt.

Overall, the markets are in high-risk bear mode now following a decade-long bull market. Good quality companies' share prices will suffer along with garbage should there be any dramatic crash (versus the mostly tech-centric fall so far). In this market I'm keeping a higher proportion in cash than over the last few years, to be able to buy into things I’m confident will rebound strongly should there be a crash. The US oil/gas and fertiliser producers do appear compelling trends, but I'm unconvinced that much of the price rises due to supply issues haven't now been priced in and that it isn't a bit of a thematic bubble forming and sentiment isn't going to turn south with demand potentially waning in second half of the year. I'm more convinced that the supply/demand picture is stronger for coal, as mentioned above. Happy to be wrong about oil/gas, and if the strong uptrend continues I'll be looking at TA momentum and oversold/overbought indicators for occasional short-term trades in some of the US oil producers. If playing the short-term game in shares in strong uptrend patterns, price dipping into the zone between 13-26 daily MA is a useful buying signal. Taking a few % being the goal.

Things that I'm holding longer term - mostly the metals - are companies whose demand/supply picture I'm fairly confident about in the long term and am prepared to sit through value being wiped out in any crash, as I believe these particular metals stocks would come back the hardest and fastest due to the quality of the assets, global policy of electrification not going away, and there being no forecasts of surplus supply of metals required for said policy (in fact the opposite).

Individual stocks in my PF listed below, with YTD performance and my own gain/loss since date of purchase (some bought since the start of 2022, others are multi-year holdings). YTD performance is fairly arbitrary as it's taken from the difference between closing price on Dec 31st 2021 and last Thursday's closing price. Some stocks change significantly daily*, for e.g. if you'd taken MLX's closing price from Dec 30th instead of 31st the performance would be -3% instead of -19%.
Interesting to see the differences between many of the commodities/energy stocks this year versus the main indices.

Indices performances, year to date (figures from market close Thursday. Weds for the UK):
FTSE 100: +2%
FTSE All-Share: -1%
Dow Jones Industrial Average: -9%
S&P500: -13%
Nasdaq: -22%
ASX 200: -4.6%

Portfolio performance year to date: +22%
Happy with that in a high-risk market in a downtrend. Consistently beating the index is the goal, which I’ve managed to do for the last 5.5 years. Otherwise may as well invest in a low-risk index tracker.

New additions or sells during 2022 below. Performance is year to date, performance since my purchase date in brackets:

Osisko Gold Royalties: -2.5% (+1%) Mid-term hold. Gold royalties streamer.
Anglo Pacific: +20.7% (-9%) Long term hold. Royalty streamer for cobalt, vanadium, copper, coal.
Altius Minerals: +16% (-14%) Long term hold. Royalty streamer for potash, renewables, coal, copper, nickel.
Whitehaven Coal: +107% (+32.9%, plus estimated divi of ~12-18% August) Hold for divi and re-assess.
Touchstone Exploration -1.5% (-4.7%) Hold for September production and cash flow.
MLX: -19% (+34%) Sold ½ for +38%. Holding remainder.
NGEX Minerals: Sold all for +38.5%  Short-term trade.
Zacapa: -28% (-20%) Sold 1/5 for +18.5%. Remainder held for somewhat binary result of assays pending from 'Redtop'.
NICO Resources: Sold all for +100%. Shares allocation from a spin-off for shareholders of MLX.
Meridian Mining: Sold remaining for +62.5%
Filo: Sold around 1/5 at various prices between $20.50 – $26.50 for around +400%.  Still largest holding in PF.
Alphamin: Sold around 1/7 at $1.20 for +120%. Holding remainder. Concern over war with Rwanda, always going to be the risk with investing in DRC.
Illika: Sold all for 49% loss.
Trackwise Designs: Sold all for 71.9% loss
Glencore: Sold all for +2.5%  Short-term trade. Would consider re-purchasing dips to the 50 day MA if it remains in a strong uptrend.
Mosiac: Sold all for +2.3%. Short-term trade.
Occidental: Sold all for +3.2%  Short-term trade. If trend continues then I’d consider further short-term trades on dips into the 13-26 zone on daily MA.
Exxon Mobil: Sold all for +1.5%  Short-term trade. If trend continues then I’d consider further short-term trades on dips into the 13-26 zone on daily MA.
Diana Shipping: +63% (+3.5%) A northstar tip, bought mainly on TA - bought this week on breakout and backtest of multi-year resistance. Target is 7.90. A bit of fundamental involved too - obviously shipping companies are making good revenue in current climate. Diana have flipped from a loss last year to profit this year according to the last quarter’s earnings and forecasts for rest of year. Also has a good divi yield.

[petejh]

Edit, double post.

[kelvin]

Edit, double post.

Nice work on a hefty profit figure for the year. After giving us all the nod on FILO, you deserve it.
Lots of my friends are down considerably, mostly due to tech crashing, and are really despondent.
I've gone much in the same direction as you Pete - I had a look at what we use for energy and tried to hedge the costs by buying stocks in associated companies. So far, it's working really well.

We use mainly coal (smokeless) to heat the boat. Diesel for movement and some heating, plus some mains electric. The vehicles are both diesel.

Whitehaven was the obvious choice to buy in thermal coal, although twinning that with New Hope seemed wise to me. Pete's outlined all the reasons for Whitehaven. A no-brainer unless a windfall tax sweeps all before it. Huge dividend expected from both.
Lots of noise about taxing windfalls currently, so sold most of my Petrotal on the LSE, all my Vertex, Val and RIG in the US, Journey and Vermilion in Canada. Still have Meg Energy and also Western Energy - jumped in on Western on Thu and bought shares worth 8% of my PF at CAD0.04. They closed on Friday up 37.5% on the day. If only all Fridays were like that and my timing always as perfect. The fundamentals seemed strong, I have no TA but they had huge debt and had to massively increase the share count which killed the price. Now, with manageable debt they should get to 20c fairly quickly. I'll take out my original investment sometime soon and let the rest run.
Completely covered all my energy bills for the year and some. I know it's gonna be really tough for some and appreciate just how priveliged I am to be able to do this.

Other than that, bought some Filo again at something over CAD21 and as normal, it's doing well. I think it's hole 60 that's released soon - be interesting to see what it does on the news.
Today, I bought some Yellow Cake on the LSE. I just can't imagine how we keep up with current energy usage without nuclear, let alone grow it for EVs. It is currently cheap as chips used to be.
What else? Ah, the royalty thing for the same reasons as Pete. Bought a basketful - Franco Nevada, Black Stone, Freehold, Anglo Pacific and Altius. 

Still thinking a recession will hit at some point, so currently about 50/50 cash and equities. No bonds, shorts, calls, puts etc and definitely no debt.

It's been a head scratching year that's for sure and as a beginner at investing, I was definitely too slow to react to the tech crash and the recent mini crash that happened across the board. I've also probably traded far too much. I'm certainly expecting the unexpected nowadays however and that's no bad thing. Up 34.4% for the year, which I'm chuffed to bits with.

I hope everyone is doing as well, if not better and still finding things that make sense in the current situation.

[petejh]

A couple of pieces of reading some investors might find interesting.

Firstly the Moneyvator blog this weekend has a link to a metastudy on 'the behaviour of individual investors': https://alphaarchitect.com/2022/07/individual-investor-behavior-what-does-the-research-say/

..which reinforces what every investor should be aware of: that, on average, active investors will perform worse than the market and therefore you - probably being average - should probably invest in low-cost tracker funds and forget stock-picking, unless you have evidence of some sort of edge.

Second, a link to a memo from Howard Marks on the attributes of those non-average investors who do beat the market. https://www.livewiremarkets.com/wires/howard-marks-3-attributes-of-investors-who-will-always-outperform
(link to the full pdf is at the bottom of the linked page)

Both make good reading.


Various commodities swooned over the last couple of months. Nothing unusual, it’s what commodities do. The key to resource investing (all investing) is getting into quality companies early in a cycle, or on pullbacks in an overall rise. Or, if you're just a riding a momentum bubble then be aware of it and get out before sentiment stalls - for e.g. fertiliser and oil/gas companies after March 2022. For resource explorers and developers choosing quality projects and being patient is key to making gains  - CTM, Filo, AFM and GGP fit this profile. All are still at good entry points in context of future growth potential, imo.

I opened a short-term trade in Adriatic Metals @ £1.15 on recent weakness. Technically it was showing a divergence on the macd-h, had hit a significant fib retracement level, had dipped below a long-term support/resistance level (@ 1.20) and was showing oversold on the rsi. With those signals and knowing the company fundamentals well I can be fairly confident that it's probably bottomed barring any catastrophic event. I originally invested in Adriatic in early 2020 and planned to keep hold until they completed their Bosnian silver/zinc/lead mine and production in 2023. But sentiment ended up tanking in late 2021 on political instability (Bosnian Serbs threatening to break-away, with Russian backing) so I sold in late 2021 for a decent profit. It was a shame as it's a genuinely world-class project and one of the best silver/zinc projects currently on the market. Fully funded to production and with good levels of management and institutional ownership (European Bank of Reconstruction and Development, among others). There's a bit of a sentimental attachment for me - during the war in 1995 I was a fresh-faced 20-year old based not far from where their new mine's located. It's good to see a project that helps the region progress and this mine will be Bosnia's largest exporter, contributing 1.5% of the country's GDP. The ceo Paul Cronin seems to be one of the industry's good eggs and doing things the right way in terms of community engagement and environment. Overview of the project from their corporate relations guy: https://youtu.be/1o54G7-_Ero?t=9
Free cash flow starts next year, quickly ramping up to £200m+ per year, on a current market cap of £315m. So Adriatic's at a very decent entry price here. They're in the dip on the Lassonde Curve with less than 12 months to production so price 'should' do well from here starting pretty much from now (there are no guarantees ofc). I have other needs for my invested money so my plan is to sell for a short-term 10% profit which, if the rebound momentum continues in silver's spot price (movement in silver tends to move Adriatic) then I expect to hit my target in the next 2 weeks. If silver goes on a rip I'll hold a bit longer but doubt I'd hold beyond autumn.

Alphamin suffered a drop on the triple events of: 1. Announcing it had concluded its review and that it isn’t currently seeking a buyer - this led to those investors who piled in on the excitement of a potential buy-out piling out again. 2. Instability on the border between DRC and Uganda - nowhere near AFM’s mine or export route, but the average investor doesn’t know or care about that. 3. Tin spot price dropping from $45k to $25k per ton. They’re still printing large quarterly profits at $25k as their cost of production is $15k per ton.
Quarterly earnings were announced last week, valuation is cheap at current price on EBITDA/EV or cash-flow multiple basis. And the second of the twice-yearly dividends was announced which, added to the dividend earlier in the year, gives a 10% return-to-date on my original investment (@ .55c) in addition to the ~40% capital growth at current share price. With zero debt there’s nothing to worry about here and Alphamin remains a no-brainer long term investment as far as any company operating in DRC can ever be. A cash cow value share at this valuation, and an exciting growth share within the next 1-2 years - according to the feasibility study Mpana South will be built and operating by late 2023/early 2024 nearly doubling production and free cash flow. Price of tin would have to drop and hold below $20k/t for me to alter my view on AFM, and if it did then global tin supply would soon tighten as that price doesn't incentivise any new supply to come on line and supply is already tight.

Filo dropped along with the rest of the copper sector with the drop in copper spot price - a reflection of expectations of reduced global economic growth ahead. The next round of drill results are due for release imminently, they're hoping to prove up further large extensions to the project - as was suggested by the last set of results. Any weakness in Filo’s price is a gold-plated opportunity to add shares imo.  If you believe copper might be a bit in demand over the next 5-10 years and that there is supply tightness ahead then this is a very lucrative way to benefit from that dynamic. Filo is the best copper exploration/development project available on public markets by far, bar none. The only uncertainties are not if it rises higher than the current price but how quickly and by how much. Expect fireworks along the way and don’t get shaken out below mid $20s (unless Argentina decide to commit economic suicide by nationalising mining, in which case panic sell!). I sold a bunch in the high $20s during the last rise. It’s still my largest holding. At $18 I'm up over 300% but my expectation is $30+ in the next 1-2 years. It will have pullbacks along the way.  My opinion on Filo is just hold it and forget about it. Don't panic on any pullbacks and don't sell any unless the alternative is a kidney, the patient will be well rewarded from this level. All of which is not advice, imo, do your own work, etc. etc. 

Still holding Whitehaven Coal and looking forward to earnings in August which are forecast to be ridiculously good. I bought at $4, currently up 55%, in addition to a dividend to be announced next month anticipated to be between another 10-20% per-quarter (on purchase price). Further share buybacks starting in September. The price of Newcastle coal (the commodity Whitehaven produces) has rocketed on demand from Europe and SE Asia and the monthly profits being made by WHC are rather large..! Coal futures prices also look to be strong through 2023. I hesitate to suggest buying WHC now, as the share price growth this year has been phenomenal for a boring old coal company (+125% year-to-date). But on future cash flows WHC is still vastly undervalued, a legacy of being completely buried by ESG mandates leading to divestment from coal, now temporarily revived from the grave for one last commodity cycle. $8-9 would be fair value, so another 50% gain from here plus a 10-20% dividend. If anyone is considering buying then be careful holding for too long once the cycle starts to turn, probably in 2023. I won't be surprised to see further buying ahead of earnings with the company going ex-dividend in late August. Also wouldn't be surprised by end-of-month dumping in late August, as naughty institutional investors cleanse their books of any dirty non ESG-compliant coal deviancy that they don't want clients to see...

Bought and sold Peabody Energy for a quick 10% gain ahead of last week's earnings. While it sells a similar commodity to Whitehaven this US producer is hamstrung by various balance sheet technicalities too lengthy to go into here, which I hadn't realised until after I bought (not permitted to pay a dividend being one).

Still holding Diana Shipping. Earnings were announced this week - they beat estimates and price is rising back toward my purchase price of $6. They announced a quarterly dividend of 4.8% per-quarter return on my investment, price is currently around 8% down but with strength in the US dollar and dividend I’m around breakeven. On TA it’s looking like the price may again challenge the long-term break-out line (in the low $6s), after failing to sustain a rise last time it broke that level in early June. For anyone interested there's time to invest before it goes ex-dividend on Aug 5th.

ZACA showing some life from the dead this week. This high-risk explorer will be sold if/when it ever gets back to a +5% gain at around C$0.40.


As for everything else, my plan is to hold mid to long term (another 1 - 5 years). These long-term investments are mostly resource developers/producers/royalty companies set to benefit from the energy transition and tightness in the supply of copper, nickel, tin and cobalt; plus new battery tech (GMG); some gold (GGP/AEM/OR), and one oil/gas developer-producer (TXP). Polx is the odd one out, a biomed company with new lung-imaging tech awaiting FDA approval decision in October.
(CTM, MLX, AEM, OR, GGP, GMG, POLX, OMI, ALS, APF, GLEN, TXP, ZACA).

[Yossarian]

Interested in Whitehaven Coal but not seeing the stock on HL - where are you guys buying it?

[kelvin]

Interested in Whitehaven Coal but not seeing the stock on HL - where are you guys buying it?

interactive investors for me

[petejh]

Yep interactive investor for me. It's possible to trade all major global markets with II either inside or outside an ISA.

However note II charge a flat-rate of £10 per month. You get one free trade per month. This system works out as economic for regular investors and/or for large trading amounts. It doesn't work so well for small trading amounts or irregular traders. Worth examining how much you're investing before opening an account.


WHC earnings for full year 2022 were announced last week, excellent as forecasted. In fact they reported their highest ever profit in over 22 years of producing coal, which is astonishing and a reflection of how few major coal producing companies there are remaining. The pivot over the last 12 months has made WHC the ASX 200's 3rd best-performing share this year to date (another coal producer the 4th). I'll copy/paste the figures below from the earnings announcement and you can see the turnaround from 2021 to 2022. Note the points I've highlighted:

Whitehaven Coal (ASX:WHC) has reported a record net profit after tax (NPAT) of $2.0 billion for the year
ended 30 June 2022, and earnings before interest, tax, depreciation and amortisation (EBITDA) of
$3.1 billion, which is a significant increase on the $204.5 million of EBITDA in the prior year.
Whitehaven’s FY22 results highlights also include:
• Record revenue of $4.9 billion underpinned by an achieved average coal price of A$325/t (compared
with $1.56 billion revenue and A$95/t average price in the prior year)
• Cash generated from operations of $2.6 billion compared with $169.5 million in the prior year.
• During FY22, all senior bank debt was repaid and $1.0 billion of net cash was held on the balance sheet at
30 June 2022, versus $808.5 million of net debt at 30 June 2021.
• A fully franked final dividend of 40 cents per share will be paid on 16 September, taking the full year
dividend to 48 cents per share.
• After announcing a 10% on-market share buy-back in February 2022, 76.37 million shares (or ~7% of
issued share capital) were bought back in H2 FY22 for an average price of $4.75 and a total investment of
$362.6 million.
• In H1 FY23, Whitehaven aims to complete the 10% buy-back within the previously announced cap of $550 million.
• The Board will seek shareholder approval to increase its share buy-back programme at the Company’s Annual General Meeting in October.

I'm up 100% on WHC, this month's dividend payment will equate to a further 10% on my investment. Solar panels and battery storage here I come. I'll say to anyone considering buying - be careful here, as price is pushing all time highs daily. Hard to predict how it will perform from now as global markets are on edge, many investors will be taking profits from big gainers like WHC to cover losses elsewhere, and after a share goes ex-dividend (on Sept 1st for WHC) price often drops a bit to reflect the reduction in cash following payout.

However.. the bigger picture is this. As noted above the 2022 share buy-back programme will continue to completion between now and October, helping to support share price. Then, the next price catalyst will be the announcement at the October AGM of the next share buy-back programme, which will start shortly after. This buy-back is announced to be larger than the current A$550m allocated to buy-backs.

The potential effect on share price of share buy-backs at different amounts can be seen in the spreadsheet below, which uses realistic assumptions when compared to the figures reported in 2022 earnings (not my work, I found it through reading up).
Key:
SOI = shares on issue.
NEWC = price of newcastle coal (currently $427/t for Sept 2022, out to $334 for Sept 2023...)source. Note the average price achieved in above 2022 earnings..
SP = share price @ 4 x price/earnings



When reading the above spreadsheet consider the following:
Shares on issue currently are 911m.
They've bought back A$362m worth of shares @ average of $4.75 to date. They will continue buying back, up to the 2022 cap of A$550m.
Then, in October the 2023 buy-back will start - this is expected to be larger than A$550m.
If we say buy-backs are achieved @ an average share price of, say, A$10 (but pick a price between 6 and 11) and a buy-back fund is announced of, say, A$650, then that's another 650 million shares removed from shares on issue...
Do the maths using the spreadsheet above and the fundamentals support a share price of somewhere between $10 - $16 per share.
Plus the next dividends, as there will be another year's-worth of them, minimum. Coal isn't disappearing overnight, but its price will drop off at some point. The futures price of Newcastle coal is currently forecast to remain high (above $300/t) for the remainder of 2022 into 2023. Guidance for 2023 from WHC:

Commenting on FY23 market outlook and guidance, Mr Flynn added:
“Demand for high-quality seaborne thermal coal is expected to remain strong throughout FY23 and high-CV
coal prices should continue to be well supported.
“We expect to deliver higher ROM production and coal sales in FY23 compared with FY22, and we are focused
on maximising margins including managing inflationary cost pressures.

In short - fundamentals support the current share price and suggest further growth, but the largest gains have possibly been made and any significant change of sanctions conditions for energy from Russia could hit coal futures quite quickly. To estimate the risks you need to ask how likely that is. Longer-term, with commodities there's a timescale involved with valuation and having a view on the commodity cycle is essential to having an informed view on when something is becoming overvalued. 

I'll finish on WHC with a point aimed at Simon about value shares, as he appears to believe this thread doesn't concern itself with value shares . WHC (along with Alphamin - as noted by other value investors) is the epitome of a 'value share'.  A formerly indebted company in an overlooked industry, selling a product that was unloved, undervalued and ignored at the end of last year but which has been completely transformed through profits from sales into the 3rd best-performing company year to date on the ASX 200. Returning capital to investors via dividends, buy-backs and price growth. It's one of the best current examples of a value share you could come up with and this was apparent to many value investors even before reliable sources of energy became weaponised.

I opened a short-term trade in Adriatic Metals @ £1.15 on recent weakness. Technically it was showing a divergence on the macd-h, had hit a significant fib retracement level, had dipped below a long-term support/resistance level (@ 1.20) and was showing oversold on the rsi. With those signals and knowing the company fundamentals well I can be fairly confident that it's probably bottomed barring any catastrophic event.
...
I have other needs for my invested money so my plan is to sell for a short-term 10% profit which, if the rebound momentum continues in silver's spot price (movement in silver tends to move Adriatic) then I expect to hit my target in the next 2 weeks. If silver goes on a rip I'll hold a bit longer but doubt I'd hold beyond autumn.

Sold Adriatic this week for 10% profit, 1 week later than suggested. Adriatic are going places and are a top quality company which I'd normally be very happy holding. There will be an updated resource estimate will be released to market this autumn for the Bosnian mine, and their Serbian asset is also awaiting an updated MRE this year. Both will likely be catalysts for price. Production in Bosnia starts early next year and this event should re-rate share price higher. But I made the trade with the aim of a quick profit to pay for my house move conveyancing.

[petejh]

If we say buy-backs are achieved @ an average share price of, say, A$10 (but pick a price between 6 and 11) and a buy-back fund is announced of, say, A$650, then that's another 650 million shares removed from shares on issue

Apols should read 65m shares removed from issue @ $10 per share. (In addition to the approx 27m shares to be removed from issue between now and Oct to complete the current 10% buyback). When you look at current and projected price/t for coal, the fundamentals are pretty clear.

[kelvin]

Nice roundup on WHC Pete.
Not sure I'd be buying now, I'd perhaps hope for a dip after the divi but it has just been grinding upwards relentlessly. A keeper for me as it pays for my heating on the boat.

I have had a major rethink too, I took advantage of the good highs in the market last week to go to 70% cash and chill my way through to the new year.
I'm 30% up YTD, even allowing for being roughly half in cash for over two months now and when I set out I just wanted to beat the interest a bank gave. It's been a huge learning curve and my brain could do with a rest. There have been some huge and daft losses but Filo amongst others, mostly energy have saved the day.

I sold UAN at a 19% profit plus a huge divided even after tax.
 I also sold both Alphamin and MLX. I took profits on AFM back when it was well over CAD1.10, so up on tin despite the recent drop, it's still a great thesis and I'll look to buy back in eventually.

I recently bought back into Vertex, the refiners. This stock has been kind to me, initially buying in at @ $9, selling at over $14. Then buying back in at $12 and selling at $14 the day before earnings. They turned out to be a shock. Horrendous management caused far worse than expected results and the share price plummeted to under $7 for a short while. I eventually bought back in at $7.60 a week ago. Currently up almost 15% but planning to hold if nothing much changes in the macro picture. If, big if, the management doesn't cock it all up again, I'll look to sell at $14.

Sold a lot of energy and bought others. Swapped Journey for MEG as an example.
One recent buy was KLX Energy Services for $7.29, they supply the onshore industry. Seems super cheap to me, as before covid they were over $50. If the macro picture for US energy security stays the same, then I'm optimistic about KLX.

Current PF is

Energy - Whitehaven, MEG, VTNR, KLXE and Whitecap. Also Yello Cake for a uranium interest.
Gold - Franco Nevada and Sandstorm royalty companies.
Metals - Filo, Vizla Copper, Sable Resources, Anglo Pacific and PMET.

PMET, Patriot Battery Metals is a lithium play in North America.  I put 5% of my PF in for one day and then took back my investment, leaving the profits to hopefully grow. Slight mistake there, as I'm now up 43%... should have left the lot on it. Currently 1% of my PF.

My partner's ISA, I've left in Whitehaven and Filo, plus she has a nice amount of Premium Nickel Resources after they took over NAN recently. Very optimistic that PNRL will help to regain some of the tech losses she had suffered from at the end of last year. They're definitely worth a look at if the battery metals thesis appeals.

[petejh]

Yes, the brain needs periods of rest from this! Especially during the steep learning curve part, and double-especially in the current market. There's much to be said for trackers and not being an active investor. You seem to have played it really well the last 12 months. I found it took me 2-3 years of solid intense learning around various different aspects of the sector I chose to invest in, and of understanding technicals and valuation (still my weakest part, but not bad at it) before I felt more secure and stable with the risks and volatility. Some days I still worry a little bit but that's natural. This was after being an occasional investor for a couple of decades then deciding to take it more seriously around 2014.

Fellow PMET and PNRL holder here, @ $5.05 for PMET and $2.07 for PNRL, with 1.5% and 1% of my pf respectively. Both appear legit and are in the exciting part of the journey but it's still too early to know how much is promotion and how much is solid fundamentals - you heard about PMET for a reason (the same reason that I heard about them..! he isn't an angel..). The signs are good however, very encouraging that Alphamin's COO Boris Kamastra - who oversaw development and production of the Biese mine - was hired by PNRL, gives them credibility.
PMET also encouraging that they hired the ex Pilbara Minerals CEO who took that company to billions in market cap on their lithium project. So they both have highly credible management on their boards. Could be one of those insane success stories like Filo, or it could be promotion (like ZACA, although awaiting further drills). My jury's currently out.

[kelvin]

PMET ending at +16% today, completely nuts this one finishing at $6.16.
Bought in at $3.73 on the 10th of this month and I certainly think it's a narrative stock at the moment. As I'm 'playing with house funds' after having my initial stake back, I'm feeling pretty relaxed with the volatility.

As regards the taking 2/3 years to get into gear with all the ins and outs of junior mining, I've nothing but respect for that Pete. So so much to learn. I really feel like I'm winging it most days, even on the basics of earnings reports but it is getting easier. Podcasts have helped hugely.
There's definitely an edge to be had in the sector by being a small investor, even if it's just liquidity.
Mind you, even at my level that can be a problem and when I invested in Vizla Copper, the share price rose significantly! I'd have a job liquidating that position at any sort of speed but hopefully, I won't have to.

Energy I'm following the crowd if I'm honest - plenty of 'experts' out there ready to point you in the wrong direction but apart from the recent lull, it's generally been okay. Met coal is one area were I didn't read the cycle right but thermal more than made up for it.

Ideally, I'd like to get a list of things to invest in when the bear market is over, preferably UK listed but timing that will be tough. There's a couple I'm looking at, Metal Tiger being one.

[petejh]

This might come across as a slightly flippant comment (not intended to be) - but the 'things to invest in when the bear market is over' are things to invest in now while the bear market is here, as they'll probably be cheaper. You're highly unlikely to beat the average market performance when trying to time what the next sector or company to do well will be - I know you probably know this but there are very large institutions crammed with extremely intelligent people who think about this topic every day and invest billions accordingly. We're very unlikely to know better than them, but it is possible to spot the momentum changes and ride the same themes slightly earlier than others. Generally just holding long-term and buying into a falling market is a safe bet.

Outside of bear markets - i.e. the last 12 years - I think general index trackers are the best choice for large portfolios, with some smaller-scale active trading for those of us who love it and if we can justify it on results.
In bear markets however, good stock picking can do well and outperform the market while index trackers/ETFs/Pensions etc. track downwards. But it's mentally draining to be actively trading in a bear market as you note. Just staying out of a bear market completely can outperform an index tracker, depending on inflation..

Of course if you're trading rising momentum out of a bear market (or short term rallies such as we've just had the last 2 months) then it means identifying momentum stocks earlier than a certain proportion of other market participants - to make a profit you need to sell to other people who by definition will be getting in later than you and who also must believe* they're getting in at a good time...
Howard Marks talks about level 2 thinking, where someone is able to think through current events and themes by many steps into the future to try to identify  market opportunities. Combined with probabilistic ways of thinking and updating probability as events unfold i.e. Bayes.


* not that all participants are that rational - see the meme craziness

[kelvin]

The Marks article is a good read and quite humbling, some really good points.

Flippant comments are often full of truth and required hearing Pete. It's definitely a case of buying what's good now when it's cheaper.
Just bought back into Alphamin again for 65c a share. I've managed to sell and buy in cheaper maybe three times now but I could certainly do with the Tin price rising for a while.
My first shares over a year ago were 87c. A hugely under appreciated company.