chops_a_must
Printing My Own Money
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It would be an exponential trend, not a steady trend, and the rise in commodity prices I would argue have gone along that line.ducati916 said:
BHP - BHP Group
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link??nat said:
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txsnat said:
Knobby22
Mmmmmm 2nd breakfast
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Ducat (and BSD)
I partly agree with BSD and partly agree with you. It is not just investment sentiment that commodity prices have risen. There are a lot of hard nosed Japanese, US and Chinese people who have dine their best to keep commodity prices low.
I do agree with you that commodity prices will slowly fall because at present prices a lot of unviable resource becomes mineable and there is a hunt for more resources. Resources are not really getting harder to find (except oil) as technology is better, more parts of the world is opening up (eg Laos).
The question is: when will supply surpass the demand? BHP is in an enviable position because it has large energy resources (gas, oil, uranium) and is an efficient producer with the bucks to take over small companies should they get a great mine.
I believe it is a little cheap at present and the end of the boom is still a distance off. Profitability will reduce but not before BHP has managed to grow a fair bit bigger and hopefully avoid the pricetaker scenario. It is not an obvious buy or sell to me at these prices.
I partly agree with BSD and partly agree with you. It is not just investment sentiment that commodity prices have risen. There are a lot of hard nosed Japanese, US and Chinese people who have dine their best to keep commodity prices low.
I do agree with you that commodity prices will slowly fall because at present prices a lot of unviable resource becomes mineable and there is a hunt for more resources. Resources are not really getting harder to find (except oil) as technology is better, more parts of the world is opening up (eg Laos).
The question is: when will supply surpass the demand? BHP is in an enviable position because it has large energy resources (gas, oil, uranium) and is an efficient producer with the bucks to take over small companies should they get a great mine.
I believe it is a little cheap at present and the end of the boom is still a distance off. Profitability will reduce but not before BHP has managed to grow a fair bit bigger and hopefully avoid the pricetaker scenario. It is not an obvious buy or sell to me at these prices.
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Hope not - I'm short BHP
wayneL
VIVA LA LIBERTAD, CARAJO!
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Ken said:
That was yesterday. It's too early to get a fix on BHP for today in London.
rub92me
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Please explain this comment. You think day traders are the only people that use charts and/or that charts are only useful for day tradinghaemitite said:
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Reecereece55 said:
You are right on many counts.
But my 2k BHP shares are less than 5% of my total portfolio, so any loss on BHP could be replaced elsewhere.
I certainly do not fit the mold of a trader, and do not attempt to. One thing I never do is sell into weakening cycle as I can afford to hold for 5+ years, by which time most cycles have turned or ended. Now that could be defined as poor capital management. But if I recall correctly, my Onesteel and Bluescope Steel shares originally cost me nothing as they were "spun off" by BHP.
I often read about the "efficiency" of the market, and that some people actually believe it is true. The market is only a pricing mechanism. Nothing more, nothing less.
when there are no more "upside" or "downside" surprises when companies report, I will change my mind.
Norub92me said:Please explain this comment. You think day traders are the only people that use charts and/or that charts are only useful for day trading
I think that the previous comments about analysts are short sighted. Analysts get paid a lot of money for a good reason - the market thinks those skills are well worth paying for.
Analyst forecasts are on a mid to longer term basis.
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Rederob
Fair enough - if BHP is a diversified portion of your portfolio, then your logic here, whilst not my style, has merit. Especially if you have an investment time frame of greater than five years. This kind of an investment strategy is useful for a long term investor and I would never argue that such a strategy wasn't in your interest - all you have to do is review the XAO for the last 5 years. As I have said all along, I am not the kind of person who gives someone grief for having a long term hold investment strategy. In fact, I wish you the very best with your portfolio for 07 - after all we are all here to help each other, not attack one another. I also agree that BHP's divestment strategy (OST and BSL) is one of the greatest facets of the organization in the last ten years - if you held both after the spin off you would be a very happy investor! In reference to not selling in cyclical weakness, this I still disagree with - I short-sell into weakness and buy into strength - however, this is because I have a 1 month - 3 month holding time line on my stocks. Once again, its all about investment strategies and I wish you the best with yours. In reference to the market efficiency hypothesis, empirical evidence suggests that, bar some unforeseen event, the market is pretty efficient, specifically a highly liquid stock such as BHP. I won't say it's perfect because it is not - but I find it is better than reviewing the financial's or an analyst report and trying to come up with a price yourself. However, with your investment timeframe, I would think this assessment is irrelevant as you are probably going to hold for a substantial part of an economic cycle.
Haemitite, I can only concur with rub92me (a very interesting user name however i note!!!!). I mean really, do you think just day traders use charts. My time frame is usually 1 - 3 months, involves a combination of warrants for moderate leverage and the occasional options trade. Charts are not just for day traders - they are good for even someone with a 1-2 year outlook - just change the time cycle to weekly instead of daily. As for the charting short cut, I personally don't think it is a short cut - in fact, proper technical analysis is a skill that takes years to perfect. If you ask me, the long cut (obtaining a degree in finance/accounting) is much easier from a learning point of view. But hey, if you would prefer to have a dogmatic view of the investment world, good luck to you.
Cheers
Reece
Fair enough - if BHP is a diversified portion of your portfolio, then your logic here, whilst not my style, has merit. Especially if you have an investment time frame of greater than five years. This kind of an investment strategy is useful for a long term investor and I would never argue that such a strategy wasn't in your interest - all you have to do is review the XAO for the last 5 years. As I have said all along, I am not the kind of person who gives someone grief for having a long term hold investment strategy. In fact, I wish you the very best with your portfolio for 07 - after all we are all here to help each other, not attack one another. I also agree that BHP's divestment strategy (OST and BSL) is one of the greatest facets of the organization in the last ten years - if you held both after the spin off you would be a very happy investor! In reference to not selling in cyclical weakness, this I still disagree with - I short-sell into weakness and buy into strength - however, this is because I have a 1 month - 3 month holding time line on my stocks. Once again, its all about investment strategies and I wish you the best with yours. In reference to the market efficiency hypothesis, empirical evidence suggests that, bar some unforeseen event, the market is pretty efficient, specifically a highly liquid stock such as BHP. I won't say it's perfect because it is not - but I find it is better than reviewing the financial's or an analyst report and trying to come up with a price yourself. However, with your investment timeframe, I would think this assessment is irrelevant as you are probably going to hold for a substantial part of an economic cycle.
Haemitite, I can only concur with rub92me (a very interesting user name however i note!!!!). I mean really, do you think just day traders use charts. My time frame is usually 1 - 3 months, involves a combination of warrants for moderate leverage and the occasional options trade. Charts are not just for day traders - they are good for even someone with a 1-2 year outlook - just change the time cycle to weekly instead of daily. As for the charting short cut, I personally don't think it is a short cut - in fact, proper technical analysis is a skill that takes years to perfect. If you ask me, the long cut (obtaining a degree in finance/accounting) is much easier from a learning point of view. But hey, if you would prefer to have a dogmatic view of the investment world, good luck to you.
Cheers
Reece
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It's probably been done before, but I wanted to see if there was a correlation between copper prices and BHP share prices.
I've averaged the price trends for copper, and I used the high in May of $3.90 and the low of January 06 of $2.10, matched to the SP high and low of $32 and $23.40 for BHP for the year.
Hope the maths assumptions are correct...the picture tells a story.
I've averaged the price trends for copper, and I used the high in May of $3.90 and the low of January 06 of $2.10, matched to the SP high and low of $32 and $23.40 for BHP for the year.
Hope the maths assumptions are correct...the picture tells a story.
Attachments
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Try again with smaller file size...
wayneL
VIVA LA LIBERTAD, CARAJO!
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Wysiwyg
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hector said:
I.M.O. investing in blue chip shares during this mining bull run for me would have been a waste of time in reference to price appreciation.The speculative and the explorer have done (on price action) exceptionally well in comparison).
24.24c dividend is pitiful, i think,for an investor.Plus a price depreciation.
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Wow Hector/Wayne
I had always thought about conducting this analysis - whether or not the relationship is coincidental, the strong correlation is fairly easy to see on the eyes. Great charts guys......
WYSIWYG, whilst I agree that the performance of small cap explorers in the last 2-3 years have provided a much larger windfall, i'm not sure I would say investing in BHP is a waste of time. I mean, as per my previous posts, I would want better price action before taking a long position at present, but if you are a holder of shares for say 10 years, it would be hard to leave BHP out of such a portfolio. The other point I make is that I wouldn't be expecting the small caps to continue this performance - many of these stocks trade at their theoretical NPV value on the basis of announced reserves before they reach JORC status - this is because all of a sudden traders have become geologists! Many of these company's state there theoretical reserves with 2% of the drill holes required to make such an assertion - watch this space in 07 and 08 I think!
Cheers
I had always thought about conducting this analysis - whether or not the relationship is coincidental, the strong correlation is fairly easy to see on the eyes. Great charts guys......
WYSIWYG, whilst I agree that the performance of small cap explorers in the last 2-3 years have provided a much larger windfall, i'm not sure I would say investing in BHP is a waste of time. I mean, as per my previous posts, I would want better price action before taking a long position at present, but if you are a holder of shares for say 10 years, it would be hard to leave BHP out of such a portfolio. The other point I make is that I wouldn't be expecting the small caps to continue this performance - many of these stocks trade at their theoretical NPV value on the basis of announced reserves before they reach JORC status - this is because all of a sudden traders have become geologists! Many of these company's state there theoretical reserves with 2% of the drill holes required to make such an assertion - watch this space in 07 and 08 I think!
Cheers
Wysiwyg
Everyone wants money
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reece55 said:
Yes...long term s.p. appreciation seems inevitable but the dividends?Is that what blue chip share investment is about?