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Romance of the 3 Counters: Blumont, Asiasons and Liongold.

Tuesday, October 8, 2013

Romance of the 3 Kingdoms, despite the elegant name, is about a bloody past in China.

Blumont, Asiasons and Liongold remind me of the 3 sworn brothers, Liu Bei, Guan Yu and Zhang Fei. Are the 3 counters just just down on their luck? Could they not regain the lofty heights attained only a few sessions ago?





Today, the counter opened at 30c, 17c higher than the closing price of 13c yesterday! To those brave enough to buy at 13c yesterday, congratulations. Short covering in progress, perhaps?

Like I said on my Facebook wall, I hope no one was exposed or overly exposed to the carnage. I wonder if people would look back and romanticise this whole episode when it finally ends.

Of course, I also wonder if there will be an episode 2.

Blumont Group Ltd, Asiasons Capital Ltd and LionGold Corp Ltd have shed up to S$8.7 billion ($7 billion) in combined market value since Thursday's close, transforming the companies back into the penny stocks that they once were before the strong run-up in their shares this year.

Source: REUTERS

41 comments:

AK71 said...

...when the market opened on Monday, the three stocks tumbled again, falling as much as 92 per cent and pulling down other small-cap shares...

http://www.channelnewsasia.com/news/business/singapore/singapore-small-cap/839608.html

veronika said...

There lies the distinction between:

1. Speculators ( gamblers )
2. Traders
3. Ordinary investor
4. Astute investor
5. Extraordinary investor

And it still boils down to:

What is your goals, needs and wants?

For the Speculators - is greed your goal, need, and want?

For the Traders - did the volatility meet your goal,need and want?

For the Ordinary investor - did the rumours meet your goals, needs and wants?

I believe the Astute & Extraordinary investors were not present... but there is still one more category left:

The market maker... and thats the one that drove the price!
And I can be assured that the goal, need and want of this market maker is exactly what was met! Elegance in meeting his/her goal!

AK71 said...

Hi Veronika,

Nice classifications! :)

Yes, there is always the rival of Wong Fei Hong's "Invisible Leg" to think about. "Invisible Hand"... ;p

coconut said...

why they want to halt trading i don't understand, who they think they are, regulators or controller? and who are they trying to protect?

market should be free from any intervention!

AK71 said...

Hi coconut,

Aiyoh, authorities are afraid they must re-turf Hong Lim Park again. Very expensive to keep re-turfing such a big field. ;p

coconut said...

markets is like a battle field, not a boxing competition, we no need referee!

coconut said...

can you immagin someone put a stop order just before the trading halt, or a person wanted to exit just before it?

this poor guy will have to exit, after trading resume, at a big discount!

what kind of f@#k protection is that!?

AK71 said...

Hi coconut,

Hey! Idea! You go organise a rally in Hong Lim Park on this. Force them to re-turf the field. hehehehe.... I sure go and support! :D

coconut said...

sure or not?

na, i let SMOL do it, he is good in talking, or "smoking". i organise wait people throw stone at me!

coconut said...

but for SMOL, i think he can still smile when people do that to him haha, nice guy.

AK71 said...

Hi coconut,

People throw stones at him and he smiles means he enjoys it har? That is nice? I thought that means he likes pain! ;p

Steven Yap said...

Hi AK,

Lets hope we dont see people jumping off buildings anytime soon...


Best Regards,
Steven

AK71 said...

Hi Steven,

Well, I hope not too but I would not be surprised if it should happen. :(

coconut said...

as market participants, we must not take this kind of intervention lightly and be well aware of the concequencies even though we are lucky this time round that we are not involve in it!

as long as you are in the market place, it will hit you one day, the more the authority get involve with free market movement, much like the fed maddle with interest rate and liquidity, there is going to be a lot of people getting badly burn cos of false perception, period.

AK71 said...

Hi coconut,

Then, what about companies who call for voluntary halts like in the case of China Minzhong? That was also meant to "protect" investors. ;)

coconut said...

why should they call for halt, cos the price kanna hammered?

if the company is financially sound, why worry about the price? the insiders should be picking up stocks that nobody wants isn't it?

do not put any restriction, the market will find its true "value" soon enough.

AK71 said...

Hi coconut,

You are a boy scout. A bit like me. I like! :D

However, you know what they say about how the world is not made for boys scouts... -.-"

Singapore Man of Leisure said...

1) coconut,

You go fly kite lah!

I've tried hot wax, leather whip, and asphyxiation. Where got stone throwing in S&M?

Oh my! Am I mixing fantasy with reality?

Must be the weed I am smoking...


2) AK,

It's nice to know that speculators and traders are ranked higher than investors ;)

Woohoo!

coconut said...

i know i know, i'm old enough to know haha.

i was trying to buy these stocks and i couldn't execute them on line, but the tape is running!?

WTF! so i call my broker who says that its the exchange idea to restrick people from buying?! how can it be? i have money in my trading account but i can't use them, it has to be cash on hand! what? no body carry cash to the exchange "floor" anymore don't they know!?

yes, it has to be cash outfront! i have nothing to add.

AK71 said...

Hi SMOL,

Make way! Make way! SMOL is riding a fast horse while avoiding stray coconuts being shot his way! ;p

Aiyoh, Veronika should have said "in no order of preference". -.-"

AK71 said...

Hi coconut,

So des ne. Now, I understand why you are upset. You tried to take advantage of the situation to buy some super sold down shares online and you couldn't.

I also help you scold SGX:
*&$^@%#*!KNS*#&^$%!%$*

;p

coconut said...

actually, the more they restrick, the more i wanted to buy!

hehe, i already ask my broker to pull out some funds out from the trading accounts to some place call "cash" so that he can execute the orders for me, no green light yet.

oh thanks AK, save my breath.

coconut said...

but no, not becos i cannot take advantage of anything, its not right to intervent for whatever reason.

these guys don't how market machnisim work and they just screw here and there.

AK71 said...

Definitely a bad idea to screw here and there when they don't know what is going on. Must have lobang for screw to go in. Cannot anyhow screw. I agree. -.-"

Singapore Man of Leisure said...

Language sir!

This is not a technical workshop!

Whisper whisper in my ear...

What? Not my house? Oh!!!

As you were gentlemen. Do carry on.

Red-faced.

AK71 said...

Hi SMOL,

Aiyoh, I don't understand what you are saying at all. I was just responding to coconut using his metaphor. You mean I shouldn't have? O_o

Check your FB account hor. ;)

sillyinvestor said...

In romance of three kingdoms, all three kingdoms are swallowed by Jin Sima Yan. But JIn dynasty did not last more than 1 generation, because SimaYan pass his throne to his incompetent son. Why? Inherent conflict of interest.

SGX should intervene, but not on an ah-hoc and reactive manner. SGX also has conflict of sgx as a profit driven company and as a regulator.

When SGX roll out the red carpet for SGX, the shareholder should be happy, as the many listings mean money for shareholders. But China does not have a extradition policy, and many of the s-chips are small companies, it is wise to roll out the carpet.

Does SGX play an active regulating role besides quering companies. Is there a team that verify records, or act on whistle blowing?

Ans is "no", because that might kill the opportunity to make more money then.

Now, there seem to be a more conscious effort to improve supervision, lets hope its not a half-hearted attempt

AK71 said...

Hi Mike,

Well said! We can always expect your comments to be cerebral! :)

To top it off, you are well versed in Chinese history!

I will have to remind myself to stop playing with my axe. -.-"

Topic for another guest blog, perhaps? ;p

sillyinvestor said...

Where got play with axe, if u are playing with axe, my guest blog will be like a firefly trying to be brighter than the moon. There are plenty of correlation in sun Tze war strategies with investment too. But many have already written about those. Maybe comparing warren and peterlynch with sun Tze hahaha

AK71 said...

OMG! Blumont closed at 13c with 62 million shares changing hands!

Terrible. More retail investors got hoodwinked? I hope not.

marrythaigirlsingapore said...

I wonder how many contra players burnt their finger or rather burnt their arms, if they didn't get out fast enough, we are looking at more than 90% loss of capital, so much hard-earned money gone...

sillyinvestor said...

This is what my broker send me. I am not vested, but good info. He is from lim and tan.

Hi all,

This is what I had gather about the adnormal price activities on these designated counters:


Something fishy must had been going on with these 3 companies as they point to a common director and a secretary of IPCO. All these counters had their prices being sell down since last Friday and also subsidaries of these companies. The impact had been quiet subsetial. Moreover, there is also the chain-reaction of selling down on other counters like in the energy sector: Mirach Energy, Geo Energy, ... etc.

But as of today, speculation activities has been curbed for Asiasons, Blumont and Liongold (the 3 counters that were named as designated counters by SGX) and we see the selling down cooled down. Intra days trades, short selling are not allowed for these counters and thus only genuine investors and genuine sellers are trading these counter. We also see other counters stablized after dropping to new low in the morning. I believe this sega will be approaching to an end by this week. By this Friday, those who loaded up these counters last Friday has to contra off and after that, the prices should be back to normal again after that. It is possible for all these counters to head for another low before this whole issue is over. I would expect the other counters being affected as a result of side-effect will also be back to normal after that.

But be aware of other new negative factors as US debt ceiling dateline on 17 Oct is approaching soon.

sillyinvestor said...

To be fair to my broker who always send me Technical analysis, which I always ignore as I am a FA person, anyone who like his analysis and want him as a broker, can just drop me a email at mrngjk@gmail.com. I just want to be fair as I am
Using his research. I do not earn any referral fees or charges

AK71 said...

Hi Mike,

I am also with Lim & Tan. How come I don't have this kind of service? I am probably a small potato to them. Sad. T_T

Garfield75 said...

I just find that the exchange has intervened too late.

AK71 said...

Hi Garfield,

Haha.. I think coconut would disagree. I don't have an opinion in this matter. :)

sillyinvestor said...

He is quite proactive, he will forward other brokerage house researches and sometime his own TA. But somehow, call me pandan or what, u stop trading with lim and tan and use kayhian instead. He ask me to open CFD Acc, I short genting after research, he ask me to close quickly, I close with losses only to see the price go on free fall after that. Because CFD Acc is tag to the same lim and tan Acc, that was once I tried to sell trek at profits but scroll the wrong command and end up buying at high price!! Twice!!! Yes, I am the silly and stupid one, but all these really pisses me off. I stick to my own analysis and trade only with my own call from then on.

Btw, how can u be a small potato!! Look at your trading profits!! Time to change trade representative ... Haha

AK71 said...

Hi Mike,

I think it is partially my fault. I try to avoid talking to people including my TR. Hahaha... I am just tired of talking. :)

So, maybe I come across as anti-social or cold or something. Anyway, I am probably quite happy to be ignored. LOL. ;p

Musicwhiz said...

This saga is clearly a case whereby "People know the price of everything, but the value of nothing". Enough said.

AK71 said...

The Singapore Exchange (SGX) said it is investigating the short-selling in shares of Blumont Group and Asiasons Capital on Monday despite the trading curbs imposed on the two stocks.

"There was short-selling in the two designated counters, Asiasons Capital and Blumont Group, on Monday, contrary to the trading directions given to the designated securities," Kelvin Koh, head of SGX’s market surveillance unit, said on Thursday.

“We will be investigating these cases and take the appropriate disciplinary actions as necessary,” he added.

Under Singapore rules, SGX may declare listed or quoted securities as “designated securities” if it thinks there has been manipulation of the security or excessive speculation.

SGX had said earlier that traders will be barred from short-selling shares in the three companies - Blumont, Asiasons and LionGold Corp - and those buying the shares had to make cash payments when their orders are executed.

- REUTERS
10 October 2013

AK71 said...

Gold miner LionGold Corp said it is not aware that it is under any investigation by Singapore's white-collar crime investigator, the Commercial Affairs Department (CAD).

The company was responding to a written query from The Business Times.

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