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LNG, LIQUEFIED NATURAL GAS LIMITED
frodo
post Posted: Jun 20 2014, 02:14 PM
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In Reply To: arty's post @ Jun 20 2014, 02:02 PM

I dont think LNG cares about TA or fundamentals it must have somethng pretty good going for it in the eyes of those large institutions but Ive been only buying small amounts and selling each day.

My guess would be all those big institutions buying up are not likely to be selling anytime soon so perhaps its $3 next week its like dipping into a lucky dip because no way of telling.



 
arty
post Posted: Jun 20 2014, 02:02 PM
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In Reply To: remlif's post @ Jun 20 2014, 10:03 AM

Could it be that Fundamental and Technical speculations meet at this point?
If I take the Fibonacci extrapolation according to this chart as the latter, 161.8% is the logical target level, and a return to 100% or lower a logical pullback.

Attached Image


If I still held, I'd definitely take some profit off the table - maybe keep a free-carried number till the downturn is definitely confirmed.
At present, and applying a generous risk tolerance of 3-4 days, the break point sits at about $2 (green horizontal on the RHS).



--------------------
I trade daily, but I am not a licensed adviser. Whether you find my ideas reasonable or not: The only person responsible for your actions is YOU.
I follow two rules: (1) There are no sacred truths. All assumptions must be critically examined. Arguments from authority are worthless. (2) Whatever is inconsistent with observed facts must be discarded or revised. We must understand the Market as it is and not confuse how it is with how we wish it to be. (inspired by Carl Sagan)
 
remlif
post Posted: Jun 20 2014, 10:03 AM
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Although I've sold out of LNG, I've been pondering what has moved a couple of US hedge funds to make significant investment in LNG with such urgent and reckless abandon.

Last night, the penny dropped.

It may not be a share in LNG that they want. There could be another prize and their influence on LPG's share register is simply to buy a seat at the table to "assist" the LPG Directors with their decision makong as they progress towards a final investment decision (FID) around the end of the year.

Let me set the background.

Magnolia LNG LLC is a wholly owned subsidiary of Liquified Natural Gas Ltd and hence LNG Directors are currently calling all the shots.

Before these directors make the FID they need to lock in the required $2.2billion of construction costs. This is a big ask for a small company.

They are proposing to service these cash requirements with a mix of equity and debt. Stonepeak (a US infrastructure fund) are slated to provide $660M of new equity and for this they will receive a 48% share in Magnolia LNG LLC (not LNG). LNG's share in Magnolia will drop from 100% to 52%. BNB Paribas have been appointed financial advisor and debt arranger to cover the rest of the $2.2b required.

All this is public knowledge. What follows is my conjecture.

The hedge funds obviouslly view this project favourably and believe that the eventual rewards outweigh justify the risks. They want a piece of the action. They may indeed simply be taking a stake in LNG, but I think it more likely that their interest is in Magnolia LNG and that their share raid on LNG is simply to buy a spot at the table with the LNG Directors up until the Final Investment Decision is made towards the end of the year.

What they will be asking for: I do not know.
What share holding in LNG they will require in order to get it: I do not know. I suggest that their share buying will cease when they believe they have sufficient clout and after they get their way or are rebuffed. At this point, they will have no further use for their shareholding and would be possible sellers.

If all this conjecture of mine has some substance, then there will at sometime between now and the end of the year a severe drop in the share price of LNG. Re-reading the brokers reports on the LNG website, it would seem that the current intrinsic value of LNG should be around $1 a share

Lastly, can I say that I have no expertise in merchant banking or Hedge fund strategies. I am just a simple investor looking after my retirement monies.

 
remlif
post Posted: Jun 17 2014, 10:58 AM
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In Reply To: arty's post @ Jun 17 2014, 09:44 AM

Hi arty,

Thanks for the advice. You're right. Let your winners run and cull your losses!

But I've sold out completely now for a gain of $200k.

I'm continually reminded of my experience a few years ago with the ticketing company ERG where I watched a $30k investment grow to $500k and then went overseas on long service leave. By the time I got back it had mostly gone and I ended up selling them at a loss. Never again.

Comparing LNG with Chenier which is the only real SP comparison. It took them 5 years to become an 8 bagger. LNG has done it in 6 months. Something doesn't add up.

I've already broken all my SMSF investment rules and with 30th June approaching I only had 2 weeks to repair the damage.


I wish all of you every success with LNG. It has been good to me.

 
frodo
post Posted: Jun 17 2014, 10:23 AM
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In Reply To: frodo's post @ Jun 17 2014, 10:14 AM

Thats it unless you are LT its impossible to trade after it has risen so high in just the past two days let alone a four bagger in about 5 weeks or less Im not counting.

I just cant believe what it does every day wish there were more of them out there.

 
frodo
post Posted: Jun 17 2014, 10:14 AM
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In Reply To: remlif's post @ Jun 17 2014, 09:15 AM

Morning remif I feel exactly the same as you do. This morning there are plenty of orders going through but tiny ones so that makes me more nervous. Cant help feeling its bring primed for another fall like we had a couple of weeks ago. But who knows you would have to have a cyrstal ball it could be $10 next week for all I know. It is making me nervous I havent got the investment you have but cant afford to lose what Ive got either.

I am looking to hold now just a few to trade.

 


arty
post Posted: Jun 17 2014, 09:44 AM
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In Reply To: remlif's post @ Jun 17 2014, 09:15 AM

Hi remlif;
a quick comment, if I may:

Being the largest holding by present value shouldn't worry you; it merely means it's outperformed your other holdings. Which is not surprising. After all, how many 8-baggers can you reasonably expect over a four-month period?

Attached Image


It would probably be a better approach to determine the portfolio composition by cost base; assuming (only to simplify the Maths) that you hold ten positions, spread over the main sectors, each bought for $10K, that could be considered a balanced portfolio.
Then you can rank the ten stocks by present value and determine whether some under-performers ought to be replaced by $10K worth of shares that have better prospects. But selling an 8-bagger at a discount seems to be counter-productive IMHO.



--------------------
I trade daily, but I am not a licensed adviser. Whether you find my ideas reasonable or not: The only person responsible for your actions is YOU.
I follow two rules: (1) There are no sacred truths. All assumptions must be critically examined. Arguments from authority are worthless. (2) Whatever is inconsistent with observed facts must be discarded or revised. We must understand the Market as it is and not confuse how it is with how we wish it to be. (inspired by Carl Sagan)

Said 'Thanks' for this post: remlif  
 
remlif
post Posted: Jun 17 2014, 09:15 AM
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In Reply To: frodo's post @ Jun 16 2014, 04:30 PM

Having similar troubles myself frodo,

I sold out half my stake on Friday at $1.58. Perhaps the same shares that you bought?

LNG had suddenly become the largest single component of my SMSF and that was a danger signal to me.

I reasoned that Baupost do NOT usually look to become the dominant share holder in any one investment and sooner or later will reach their intended level of investment in LNG.

When that time comes and they withdraw from the market, LNG share price could drop like a stone and perhaps even halve. I got nervous. In fact I'm still nervous. Perhaps more nervous than I am greedy.

 
frodo
post Posted: Jun 16 2014, 04:30 PM
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In Reply To: mme's post @ Jun 16 2014, 04:16 PM

yes its been wild trouble is the ones i had to start with I sold a couple of times because I thought it would tank so lately Im buying tiny parcels because I cant believe it can continue so having said that it will probably go to $5. I sold some today bought in at 1.58 was going out so sold 1.77 thinking it wont make that so I can play with it when I get back so as you know got back in and it was over $2 so totally spewed.

Now I am wondering if its going to do what it did 10 days ago and that is drop as fast as it went up so now that makes me a fraidy cat. Oh for some steel in my nervous system. weirdsmiley.gif

 
mme
post Posted: Jun 16 2014, 04:16 PM
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In Reply To: frodo's post @ Jun 13 2014, 06:35 PM

What a ride for LNG holders! What 12 cents through to over $2 in 12 months! Well done to those who bought! biggrin.gif

 
 


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