HIGH-GRADE NI-CU-PT-PD-ZN-CR-AU-V-TI DISCOVERIES IN THE "RING OF FIRE"

NI 43-101 Update (September 2012): 11.1 Mt @ 1.68% Ni, 0.87% Cu, 0.89 gpt Pt and 3.09 gpt Pd and 0.18 gpt Au (Proven & Probable Reserves) / 8.9 Mt @ 1.10% Ni, 1.14% Cu, 1.16 gpt Pt and 3.49 gpt Pd and 0.30 gpt Au (Inferred Resource)

Free
Message: FWR and NOT

Re: NOT, FWR and the TSX Venture Index ($CDNX)

in response to by
posted on Feb 05, 2009 02:45PM

Here are my thoughts about both companies climbing back from their recent lows. I like to use ratios to make prices comparable. It is a bit tedious, but the results are more precise.

Dividing the stock price of NOT.V by the TSX Venture Index ($CDNX), and doing the same for FWR.V, "standardizes" their prices and make them comparable over time.

The NOT.V/$CDNX ratio bottomed during the first two weeks of Dec. 2008 at about .00065. Since then, it peaked at about .00150 twice (in early January 2009 and again on Jan. 21,2009. This represents an increase of 130% from the December lows.

The comparable ratio for FWR.V was in a low sideways range of about .00020 in November through December 2008. It peaked at about .00038 in late January and into February 2009: an increase of 75%.

What does NOT.V's greater percentage increase mean? I myself believe it indicates that in late 2008 NOT.V. was much more over-sold than was FWR.V, experienced a greater "rebound" effect, and became a bit more "overbought" in January 2009.

The rebound effect now has weakened for both stocks. At precent, both ratios are about 75% higher than their respective lows. I take this to mean they both have benefited more or less equally from increased investor interest in their stocks over the last two months. In other words, they both have beaten the $CDNX during that time, and by about the same amount.

Does this knowledge tell us which is a better buy at this time? No, it simply tells us that in the recent past both NOT.V and FWR.V did equally well against the $CDNX.

Will both companies do equally well against the $CDNX in the future? Only time will tell -- keep tuned.

Rek




Share
New Message
Please login to post a reply