Forum Archive Index - March 2001

["Michael Gore" <michgore@paradise.net.nz>]

I remember hearing a commentator on the National Radio news I think maybe
about 8 months ago saying think of gold as just another commodity and that
the days of gold being a good investment in hard times were over.  Sorry
can't remember too many details but I remember clearly thinking at the time
that he made a lot of sense.  Anyone else have any thoughts about gold as
just a commodity like any other?  Obviously it makes nice jewellery but what
else can you do with gold?  Not much that I can think of.  michael


----- Original Message -----
From: "Derek" <dkw@paradise.net.nz>
To: <sharechat@sharechat.co.nz>
Sent: Saturday, March 24, 2001 9:14 AM
Subject: Re: [sharechat] Otter? - Thoughts


> The NBR artical was informative, but I don't agree that GPG
> could pick up OTR for 31 cps. In the last while, OTR has
> reached up to 40 cps without much selling pressure
> coming into play. IMHO the drift down in share price
> is coming from a lack of buying interest rather
> than people queueing up to sell.
>
> OTRs share price is obviously strongly related to the gold
> price. They have about 83 m shares and produce about 110 000
> ounces of gold in a year.
>
> If the price of gold goes up 42c US per ounce then
> that would add $11 m (NZ) to their bottom line (13 cps).
> If it goes up further than that then the upside could
> be huge. If gold goes down or stays the same then
> OTR appears to be in trouble.
>
> My conclusion is that there is good gearing to be had
> in OTR at the moment with respect to the price of gold,
> however this should be balanced by the downside risk of
> gold staying static.
>
> According to some commentators (www.privateer.com) the
> gold price has bottomed, so here's hoping.
>
> I've found that http://www.kitco.com/ is good for
> keeping an eye on gold. One approach would be to look
> for a sustained upward movement in gold and buy into Otter
> at that stage (assumming the market here has not already reacted).
>
> In the meantime, I'm waiting for a bottoming out of OTR
> in order to do a little averaging down.
>
> Derek
>
>
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