ANL - Amani Gold

YOUNG_TRADER · 15 February 2007

Small orders only so far, so looks like impatient selling,

With the "Comprehensive analysis" of Masounia around the corner I can't believe they're selling,

The orders are far to small to suggest any negative inside knowledge and as Masounia had alot of work done on it previously the risk that there is no gold there is very next to 0, we KNOW from previous drilling that there is sections where from say 10m down (avg) there is an avg 20m thick gold deposit grading 1-2g/t Au

Its just a matter of how much, even 28Mt grading 1 g/t Au = 1Moz's

Well thats all for me until analysis comes out

greggy · 15 February 2007

YOUNG_TRADER said:
Small orders only so far, so looks like impatient selling,

With the "Comprehensive analysis" of Masounia around the corner I can't believe they're selling,

The orders are far to small to suggest any negative inside knowledge and as Masounia had alot of work done on it previously the risk that there is no gold there is very next to 0, we KNOW from previous drilling that there is sections where from say 10m down (avg) there is an avg 20m thick gold deposit grading 1-2g/t Au

Its just a matter of how much, even 28Mt grading 1 g/t Au = 1Moz's

Well thats all for me until analysis comes out

Maybe some speculators are fearing that the gold grades might be a little on the low side. But if the tonnage is there, Masounia might well be a real goer. I would be buying this one for its uranium potential and oppies issue. With your track record YT, this one could be a real winner.
DYOR

nomore4s · 15 February 2007

With the price of gold going up last night slightly suprised both BYR & LHG had poor days. Might look at buying more @ around 28c if it drops further tomorrow.
Just have to be patient and wait on the drilling results.

greggy · 15 February 2007

nomore4s said:
With the price of gold going up last night slightly suprised both BYR & LHG had poor days. Might look at buying more @ around 28c if it drops further tomorrow.
Just have to be patient and wait on the drilling results.

I hold the same view. But if I want to get in for the oppies issue then I'm probably going to have to buy in during the next couple of weeks. After seeing what happened to Uranium SA with their oppies issue I feel that the same thing could happen to BYR.
DYOR

moses · 16 February 2007

YOUNG_TRADER said:
Small orders only so far, so looks like impatient selling,

With the "Comprehensive analysis" of Masounia around the corner I can't believe they're selling,

The orders are far to small to suggest any negative inside knowledge...

The "smart money" chart suggests you're right, and that the smart money is picking up the orders as the price falls. Which imho makes a big bounce back soon very likely.

bigt · 16 February 2007

I bought back in at close yesterday, I think maybe a little prematurely, but going on holiday for a couple of weeks and didn't want to miss out on any action. The medium term downside is..well..there is hardly any, unless the uranium deal doesn't go ahead (and if I were the directors, even if the land was only good for growing spuds I'd still buy it, put a rocket under SP..;-)

YOUNG_TRADER · 16 February 2007

Hey Moses, care to give an explanantion on how your Smart Money thingy works, ie what do the lines means, etc etc

It looks very interesting

Thanks in advance

CanOz · 16 February 2007

YOUNG_TRADER said:
Hey Moses, care to give an explanantion on how your Smart Money thingy works, ie what do the lines means, etc etc

It looks very interesting

Thanks in advance

Yes, I'm keen too, saw this advertised on my stockscan site.

Cheers,

CanOz · 16 February 2007

Heres a guess though....the black line is the supply of shares, and the blue line is demand for the shares.

YOUNG_TRADER · 16 February 2007

I thought that too, but if you read the legend Blue Line is Supply/Demand Analyser and Black is smart money analyser,

What I want to know is what do they have to be above to suggest smart money buying 0.5? 0.8? 1? I don't know

moses · 16 February 2007

YOUNG_TRADER said:
Hey Moses, care to give an explanantion on how your Smart Money thingy works, ie what do the lines means, etc etc

The Nielson guide says...

Use the Nielsen Supply Demand Indicator (blue line) to watch your selected stocks for changes in buyer demand charted against changes in price. When demand changes prior to a corresponding change in price, that can be your time to profit.

Use the Smart Money Indicator as a guide to when traders are investing more heavily than usual. This is often a good sign of confidence in a stock.

The blurb says...

The information is derived from the intentions of people wanting to buy or sell a stock (ie the market depth queue)

and (describing the blue line)...

In essence, it represents the pressure of bids and asks in the market depth queue. This information in these charts are taken from the depth queue after the market has closed each day.

How do we create this indicator?

We first create a ratio of the shares on either side of the depth queue to get a feel as to the buying or selling pressure. This is then plotted on the chart so we can tell if the buyers are entering or exiting a stock. The ratio can be seen on the left hand scale of the chart.

The calculation

Total number of shares on the BUY side
_______________________________

Total number of shares on the SELL side

A ratio of 1 means that there is the same number of shares on the bid side as there is on the ask side.
A ratio of 2 means that there are twice as many shares on the bid side as there are on the ask side
A ratio of 0.5 means that there are twice as many shares on the ask side as there are on the bid side.

Normally the share price will follow the supply demand indicator as the price will change according to the supply and demand of the stock. Sometimes though, there will be a divergence between the price and the supply demand indicator. This is usually a forewarning of some impending price action. For example, if the price of a stocks has been falling and you see the blue supply demand indicator increase, it means that buyers are entering again – possibly because they think it is undervalued.

The Smart Money Indicator(Black Line)

This is the newest technology to hit the market and it can give you an insight into the activity of buyers that has never been possible before. This tool will enable you to tell whether buyers are purchasing larger or smaller amounts parcels of shares than normal.

In short, it can help spot when people have invested heavily (or are currently investing heavily) in a company. After all, no-one we know spends big money if they think the stock is going down.

How does it work?

It compares the buying pressure of the shares (the Nielsen supply demand indicator) to the pressure of the individual buyers which we can see in the depth queue. Simply, when the black line increases, it means that the buyers (on average) are prepared to buy more shares than the sellers are prepared to sell. When the black line goes down, it means that the sellers (on average) want to sell more shares than people are prepare to buy.

When the ratio is one, it means that the buyers and sellers are wanting to trade the same average size parcel.

So how do we use this information?

We use it as another clue to our trading decisions. If you see the Smart Money entering a stock, it could mean that people who know more than you do are investing heavily. You have to then ask yourself - Do they know something you don't?

In conjunction with your other research, this can be a very powerful clue as to the future price action - especially in the small to mid cap stocks.

In the traps for beginners section, the warning says...

This is an outstanding surveillance tool that can monitor the pressure (and size) of traders intentions. Used correctly you can easily become a better trader but like anything in the stock market you have to look atthe bigger picture. Following are some important points to be aware of...

*
Always check the market depth queue before relying on this indicator. Sometimes people will put in an unrealistic bid that will make the indicators increase.

*
Make sure that there is enough depth in the queue to make it a tradeable stock. With really small volumes, even a trade of $10,000 can make the skew the buy/sell ratio significantly.

*
These indicators are most accurate on small to mid cap stocks. With the big blue chips (eg BHP) this indicator cannot be relied upon as the data from the market depth queue at the end of the day is only a very small percentage of the days trading action. Also, large fund managers trade these stocks without entering the depth queue which we are monitoring.

*
Undisclosed bids or asks are treated as $200,000 which is the minimum that an undisclosed bid or offer can be. It could be higher than this number but we don't know what it is.

A full tutorial with lots of graphs and illustrations is here...

http://www.theinsidetrader.com.au/index.php?action=page&page=smartmoneytutorial.html

and right now there is a special offer allowing free access for 2 days so that you can read all about it and try it before you buy.

moses · 17 February 2007

YOUNG_TRADER said:
THIS COMPANY LOOKS VERY PROMISING

Mkt Cap of under $12m won't last for long, another BCN in the making!

Except BCN's SMA chart wasn't as promising as BYR's. BYR's chart today is more like GSE's was before it took off.

skegsi · 17 February 2007

This was posted on another forum. I don't know the person and I don't know how reliable they are, but this is what datimochum posted:

Spoke to management on Friday who confirmed the loyalty option is there for holders of BYR stock and a record date is due to be announced, probably next week as are the Gold results which shoukd come out on Monday.a record date is due to be announced, probably next week as are the Gold results which shoukd come out on Monday.

The uranium assets of Kal are being looked at by a consultant geo who is a quarter of the way thru but will have it complete before the end of this month. The md hinted it was highly likely they would take up the option to purchase.

All in all, good positive news set to be announced....now let's watch the market re-rate this tightly held baby boomer

Nothing we hadn't already suspected, but I didn't realise management could say things like "a record date is due to be announced, probably next week as are the Gold results which shoukd come out on Monday."

The December activity report said this:

Burey has engaged an eminent uranium geologist, Mr Mohan Varkey, to conduct due diligence on the KBRL properties. His formal assessment commenced in January 2007 and the Board anticipates completion of his inquiries by the end of March 2007.

Not "end of this month"

I hope the guy posting is right

nomore4s · 17 February 2007

YOUNG_TRADER said:
Let me help you,

This is a rights issue for options they will be options with an exercise price of 20c, so with an SP of say 28c they are worth 8c + a premium (how much this premium is will depend of level of demand but I reckon at least a 3c-5c premium)

So if the stock is at 25c I'd say the opies will trade at 8c - 10c

Now the options only cost 1c, so trust you'd want to take up your entitlement, oh yeah its a 1:2 rights, so if you hold 100,000 shares you get 50,000 options

I reckon by the time the rights issue is being done the gold project results would have been out for some time, not to mention due dilligence progressing on the Uranium projects, so its more likely that the SP will be north of 30c making those rights quite valuable!

G'day all,

I'm fairly new at this and am just trying to get my head around this whole option thing. If I understand YT post above correctly - If I have say 100,000 shares I can purchase 50,000 options @ 1c each ($500). The exercise price is 20c therefore the options are worth whatever the sp is trading over 20c. My questions now are
a) do the options trade under another code and can you trade them like normal? (I'm assuming they trade under another code)
b) What's the catch if there is one? (I'm assuming there must be some sort of catch to spend 1c for something worth 8-10c or more)
c) and is there anything else important regarding this that I'm missing?

Thanks in advance for any info regarding this matter

stoxclimber · 17 February 2007

nomore4s said:
a) do the options trade under another code and can you trade them like normal? (I'm assuming they trade under another code)

Probably will be exchange listed under BYRO but I haven't read up on it.

b) What's the catch if there is one? (I'm assuming there must be some sort of catch to spend 1c for something worth 8-10c or more)

No catch - in theory BYR shares will fall on the record date such that the profit you'll make on purchasing options worth ~10c for 1c is offset by the falling share price. The value of the options is inbuilt into the share price.

nomore4s · 17 February 2007

Thanks Stox,

Have been looking for info on this subject and think I'm getting a full understanding now.

Please correct me if I'm wrong but I think this is how it works

If you purchase X amount of options for 1c and hold till the exercise date and take up the option to buy you pay an additional 20c per option, therefore giving you X amount of shares which you paid 21c for instead of the full sp(which hopefully will be above 21c).

sleeper88 · 17 February 2007

nomore4s said:
Thanks Stox,

Have been looking for info on this subject and think I'm getting a full understanding now.

Please correct me if I'm wrong but I think this is how it works

If you purchase X amount of options for 1c and hold till the exercise date and take up the option to buy you pay an additional 20c per option, therefore giving you X amount of shares which you paid 21c for instead of the full sp(which hopefully will be above 21c).

yes, basicially, you have 3 choices, once you receive your BYR options.
1. Sell them (BYRO) in the market
2. If the options are "in the money" ie the BYR's sp is above 21c, then normally you would exercise it
3. If BYR's sp is below 21c, then the logically thing to do is to let the options expire, or sell them on the market before they expire.

eg. if BYR's sp is 50c in Jan 2008, lets say you have 50,000 options. If you exercise the options, you pay the compnay $10,000 and in return you receive 50,000 BYR shares.
Your total costs for these shares is as follows:
1) 1c x 50,000 = $500 (when you buy the options)
2) 20c x 50,000 = $10,000 (when you exercise the options)
3) any loss you may incur if the SP falls below your purchase price at the record date (if applicable) eg, buy 100,000 @ 35c, and sell on record date @ 30c, incurring a $5000 loss

so usually the 50k shares you gain when you exercise will cost $10500.

hope that helps

cheers..

happy chinese new yr to all!!

sleeper88 · 17 February 2007

In addition to the above, BYRO will "usually" trade at a slight premium.

skegsi · 17 February 2007

People have suggested to me to have a look at USA as a guide to what happens to the share price when loyalty options are involved:

From what i can tell, the share price rose from about 31c, one month prior to the record date (18th Jan) all the way up to 57c on the day before it went ex-entitlement. On the day of ex-entitlement (12th Jan) the share price dropped ~20% and it is now consolidating around where it was before the sharp uptrend.

1) I've read that there is usually a 4 trading day lag between the EX date and record date (which was the case with USA) Do the people that sold on the ex date still get there options?

2) If BYR plan on announcing details of the loyalty options soon, should we expect a similar rise in sp as seen with USA. BYR holders are in a good position where their gold drilling results are due before the loyalty options details and will hopefully add a little extra boost to the share price.

3) Are holders at the moment planning on dumping at ex date and re-entering prior to uranium ann's? Or Just holding whole way trough?

stoxclimber · 18 February 2007

nomore4s said:
If you purchase X amount of options for 1c and hold till the exercise date and take up the option to buy you pay an additional 20c per option, therefore giving you X amount of shares which you paid 21c for instead of the full sp(which hopefully will be above 21c).

Yep - although you don't really need to "hope" the share price will be above 20c since if its under you'll just not exercise..

The options value stems from two sources, the 'instrinsic' value of the option and then the volatiltiy value..

The 'intrinsic' (im not sure that this is the proper term) is the difference between the share price and the exercise price..e..g. if BYR is trading at 25c and the option has an exercise price of 20c, it has intrinsic value of ~5c (not exactly 5c since you can earn interest on money that you use to buy the shares when you exercise the option, which you couldnt earn if you bought right now on market)

The volatility value stems from the fact that with an option, your downside liability is 0 (i.e. if the share price is <20c at expiry, you won't lose any money, unlike if you held BYR directly) whereas your upside risk is theoretically unlimited. Thus, the volatility in the underlying share price, the more value an option has (also longer times to expiry = more volatiltiy = more value). This is essentially the 'premium' to the instrinsic value of the option.

Therefore your choices with BYRO are a) to sell it into the market or b) to hold until expiry and then exercise/not exercise the option (depending on the share price). One should note that although the downside risk is 0 (so you can't lose more than your original 1c per option) the options value is leveraged on the share price - e.g. BYRO could easily float at 10c and fall to 0c by expiry, a loss of 100% which would be unlikely if you invested in BYR - so what I'm trying to say is the value of your options can fluctuate wildly in percentage terms, something you should take into account for managing your portfolio.

You should generally not exercise the option early since you will lose the volatility value of the option (some exceptions with dividends).

Hope this helps.

ANL - Amani Gold

YOUNG_TRADER

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Commonsense isn't that common

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