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Tuesday, October 26, 2010

Late for Gold then buy Lithium

Almost everyone wants to get into Gold these days. Prices have been on the uptrend. Here I too share my oversight and it happened in 2000/01 when I was at a crossroad of investing a lump sum of my money into two investments - Gold Trust or Other Unit Trust.

Why these two? At that point of time, I had limited stock trading experience and time. What I knew from years of reading was when stocks go down, Gold will quite certainly go up because of factors like safety haven, scarcity and so on and so forth. I was at the the persuasion of the banks to "come and invest in unit trusts" - easy, and steady growth. Yes the key words were that. Growth with very nice upward trend "charts". Past 3 year charts! My mind was lingering on the Gold Trust which was at about $0.60.

So no regrets now.

Instead investment is always about looking forward. And forward looking value for some new research we would believe in. Thereby summarised in my Stock Trading Rules. (see http://denzukefinance.blogspot.com/p/my-trading-system-and-rules.html)

Therefore for the past 2-3 years I have been keeping a watch on this resource - Lithium. It started when the oil prices went out of "control" to over $150 USD a barrel. And when car companies were going crazy about been bigger and larger especially in USA. Inefficient and fuel-hungry machines. Manufacturers were thinking of alternative fuels, and fuel-cell. The downturn changed this too. Being efficient is in. Being green is in. Start to think now to change this. Some vehicle owners started with retro-fitting gas cylinders for CNG or NGV. For the longer term, hybrid cars and fuel cell cars will be more and more mainstream. And for these cars to function, the main product is lithium to store electricity inside the car.

My stock highlight for this sector is Orocobre Limited (ASX based stock).
Here is the chart. From 14 December 2007 till now, there has been a whopping 900% gain. (from about 0.30 to over $2.45) Look at the green "percentage change since" indicator.


Orocobre Limited is an Australia-based mineral exploration company. The Company focuses on lithium, potash and boron resources in Argentina. The Company’s projects include Salar de Olaroz Project, Santo Domingo Project and South American Salars Project. The Salar de Olaroz Project is located in the Puna region of Jujuy, approximately 230 kilometers northwest of the capital city of Jujuy. The Salar de Olaroz Project consists of 118 square kilometers of tenements over a salar (salt lake). The Santo Domingo Project is located in the San Juan Province. The South American Salars Project has approximately 60,000 hectares of tenements on 10 salars in the provinces of Salta, Jujuy and Catamarca. During the fiscal year ended June 30, 2009 (fiscal 2009), the Company drilled 16 vertical cored holes (1136 meters) and six monitoring holes (360 meters).

1 comment:

  1. Hi its really very nice blog,very useful information..Mobiles

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