ASX Shares Short term COVID-19 opportunities in the stockmarket 2021

Discussion in 'Shares & Funds' started by Ajax, 4th Jan, 2021.

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  1. Ajax

    Ajax Well-Known Member

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    {Note from mods - this thread continues from here: Short term COVID-19 opportunities in the stockmarket [ASX Shares]}




    The three stocks I think are good buys at the moment all have exposure to copper.

    Copper price is at 6 year highs. Fiscal stimulus programs worldwide will spend on clean technology including solar, wind power and electric vehicles. Electric vehicles use 4 times the amount of copper as conventional combustion engine vehicles. Recharging stations for electric vehicles require a lot of copper.

    Also copper is used in building/wiring and plumbing and fiscal stimulus involves new building construction. Copper mines and copper production will not keep up with the demand. There is a great need for new copper mines.

    There are 2 producers in Australia (OZL and IGO) that I like.
    OZL has the interesting position where its cost of copper production from one of its mines (Tropicana) is negative when gold credits are taken into account. It has paid down all debt. IGO has very limited debt. Both companies are generating a lot of free cashflow. These woudl be fairly low risk plays.

    The explorer I like (and considerably higher risk play) is New World Resources (NWC). It has copper exploration in a brownfields area in Arizona USA. My buy price was 5.5c. Currently 5.6c. Has recently raised $10m with shares issued at 5c. Perrennial Value Management has bought in over 6% of shares at 5.5c. More drilling results are due including results for one hole with 18 metres of massive sulfides visible in the drill core. These drill results could be very good.
     
    Last edited by a moderator: 30th Apr, 2021
  2. DJ Adam

    DJ Adam Member

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    NWC were trading at 15 cents November 2017. Do you know what caused their shares to fall to 1 cent a year ago before the corona virus started?
     
  3. Ajax

    Ajax Well-Known Member

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    Hi DJ Adam,

    I don't know too much of NWC's history except they were exploring for cobalt before this year. The code NWC stood for New World Cobalt now New World Resources. They acquired the historical high grade Antler copper mine in January 2020 and have focused their exploration on this. Share price has risen strongly since they acquired and began further exploration for copper at Antler. They still have the cobalt assets though are not actively exploring there at the moment.
     
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  4. Ajax

    Ajax Well-Known Member

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    A video of presentation by Mike Haynes CEO of New World Resources (NWC) at the Resources Rising Stars Conference in 2020
     
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  5. DJ Adam

    DJ Adam Member

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    Their shares are looking hard to say no to
     
  6. Ajax

    Ajax Well-Known Member

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    Agree particularly if you factor in where the price of copper could be heading

    AOTH-Copper, the most critical metal
     
  7. DJ Adam

    DJ Adam Member

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    Do you have recommendations of other sites I can use to learn about shares? I'm still on my training wheels
     
  8. Codie

    Codie Well-Known Member

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    Hotcopper if you want a forum, it’s a good resource to investigate certain stocks and keep up with news flow.
     
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  9. DJ Adam

    DJ Adam Member

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    Thanks mate. I'll check it out.
     
  10. Ajax

    Ajax Well-Known Member

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    Hi DJ Adam

    a useful site if you want to get an idea if directors are buying or selling, what broker consensus is (on larger stocks) and how many shares are on issue is

    Market Index - ASX Shares Prices, Charts & Analysis

    Have it marked as a favourite.

    Stockhead is a good source of articles on mining companies but be aware this can include paid advertising by companies

    ASX Small Caps News - Australian Stocks & ASX Shares - Stockhead

    Anything written by Barry Fitzgerald a resources journalist who used to write for the Financial Review is good. Just google him

    Also buying the Fin Review each day has helped my trading. The Australian also
    sometimes has good articles

    Don't go all in on one stock. I still do this (after 37 years of investing) and have just just been given a thorough thrashing by the market. Don't always believe what directors or geologists say. Got caught out when inferred resources were removed because of incorrect assumptions about geology. Upcoming capital raisings on mining companies are a quick way to lose your $ if you buy before the raising and funds are raised privately. Always check most recent ASX announcements where quarterly cash reports (for resource companies) will show many quarters expenditure can be covered by existing funds.




    Ajax
     
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  11. DJ Adam

    DJ Adam Member

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    I get an email from stockhead every day. I'll check out everything else you've said as well thanks.
    I get 5 free trades with self wealth so I thought I'd start small with 5 $1000 trades to see how I go and go from there. If NWC fail to deliver then I'll have 4 other companies that will hopefully do well or if NWC go to $1 then I'll make $18000 return.
     
  12. Aaron T

    Aaron T Member

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    Here’s the problem. No one ever knows the market, it’s all speculative and not based on values.

    You can analyze fundamentals and consult commission hungry advisors but the stock market continues to amaze me and defy any logic the more I look at it. I don’t trade on ASX but all markets are the same.

    Tesla, peloton, zoom. They’ve all been absolutely charging but purely analyzing their P/E you’d never have taken any action on these.

    Warren Buffet’s advice to investors with small accounts (less than 5M) is by an index and relax. He’s 150 years old and seen it all.

    I guess the basic buy low sell high is the trick, there in lies the problem. What is low and what is high?

    I’ve been burnt hard on sure bets and hit sixes with 100:1 nags. Go figure.
     
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  13. See Change

    See Change Well-Known Member

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    After a dalliance with shares many years ago I leave them alone for the cowboys ..

    Cliff
     
  14. Mws

    Mws Well-Known Member

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    Still a lot easier than property
     
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  15. skyfall

    skyfall Well-Known Member

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    Did you end up investing $2-3 million in shares during this time and do you still hold or were you in and out quickly and sold everything? Interesting how things turned out and Afterpay now more than $150 after dropping to $8 :eek:
     
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  16. Sackie

    Sackie Well-Known Member

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    I had largely given control to a firm to invest for me. What I'd found out is that it didn't gel with my personality, being so passive. It was an unexpected revelation but nonetheless it was something I was becoming uncomfortable with. I eventually sold most stocks and now I trade currencies for myself myself. I'm vastly happier and it's lucrative enough for me to spend the time and effort to continue. I used to trade a lot more frequently than I do now but I've discovered if I only wait for the highest probability trades, I do much better overall. That usually equates to around 2 or 3 trades a month.
     
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  17. unicorntears

    unicorntears Well-Known Member

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    What does this mean? How large are your usual trades, if you care to share?
     
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  18. Sackie

    Sackie Well-Known Member

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    It's highly leveraged, (400%). Trades range from 0.2 lots to 2 lots depending on the trade/timeframe etc.

    @Piston_Broke actively trades currency as well .
     
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  19. twisted strategies

    twisted strategies Well-Known Member

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    well in January 2020 i bought into KGN @ $5.65 and rescues the investment cash in May 2020

    and kept the profit running ( still have about half the original buy ) , that is about as close to short-term trading as i get

    i hold PFP which hasn't done anything special yet , maybe the vaccines will trigger that

    i already held PTL before the virus fuss and they have have a modest run

    mainly i just added extra cheap shares in the big dip
     
  20. luckyP

    luckyP Well-Known Member

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    You got balls using that high leverage. :) What broker are you using?
     
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