Ironveld Share Discussion Threads

[ladeside] 25/3/2021 14:41

Thanks al, it's something I've never got involved in as just tend to buy, hold or sell in the traditional way.

I suppose it's a pretty pure form of gambling but AIM in itself is a gamble enough for me without the CFD / Spread bet stuff !!

Life used to be so simple, institution would buy in to your company which would take a lot of shares out the market, would show interest / faith in the story and share price would rise while attracting further investors buoyed by the insti's faith.

As for all this cloak and dagger hedging stuff coupled with the ramping twitter gangs,
dodgy cheap placings and continued silence from the company, it all just leaves a rather bitter taste in the mouth.....

[al101uk] 25/3/2021 12:19

As I understand it spread bets are covered a number of ways.

1. They are hedged in the market by the company taking the bet.
2. They are matched against bets in the opposite direction.
3. They are left unhedged and the company assumes the risk.

The position may not be covered immediately and a risk manager tends to make the decision on what happens and how it happens.

I'm guessing, for a company taking large bets on index moves, a position in Ironveld is unlikely to move the needle much and there is a cost to hedging. Equally though, they won't want to take on unnecessary risk.

You've also got to consider that it's easy to move the market on Ironveld (or was when I held). Why would a spread bet company take a position that it can't cover without causing that position to move in to the black (infinite money machine right there).

I'd assume the answer lies with a little of all three of the above, may change over time, but is likely to set a limit on any decline rather than send the share price skywards.

[ladeside] 25/3/2021 08:41

Cheers Al, that was very informative.

What I'm still not quite understanding though is the impact on the share price if shares are purchased / disposed of via a SB ?

The TR1 confirms a % held via "another financial instrument" but my question is how exactly are these shares acquired and how do they affect the actual share price when either the buy or sell is being worked through ??

[al101uk] 24/3/2021 17:11

I believe spreadbets offer more agility around liquidating or adding to a position than might be available in the market.

I only keep half an eye on things here and over at KZG and have no holding, but wasn't it over there that Align converted some of their holding to a spreadbet?

Really, really worth reading Aligns legal disclaimer to understand where the transparency is and isn't in their dealings.

Their concept is that they are on the same side as shareholders because they take fees in equity and also, generally, take a position at the same time. Obviously they also publish research (generally positive) that the fees are paying for.

They go on to say that there is no obligation on them to maintain a position and they can sell at any point and without notice. This could be for any reason including managing their funds. I can't find it anymore, but I'm almost certain I read an example on the site where they said that generally they would consider reducing their holding if the share price doubled.

I suspect that the spreadbets are a tactical play, but an increase in their bet on the company doing well can only really be regarded a positive. Even if they just convert Equity to spreadbet I wouldn't see it as a short term negative, rather a repositioning for the medium term when they may want to liquidate.

I find Align fascinating and still can't decide if they are a good or bad thing for investors.

[ladeside] 23/3/2021 21:48

Cheers Clarea, Yes that would make sense.

As we've said before though, it's certainly far from transparent.

[clarea] 23/3/2021 18:13

Lakeside I'm not 100% sure it looks like the latest position is through a spread bet presumably to the upside and my limited knowledge is there will be someone on the other side of the trade that will be holding the said 3.29% ready to deliver if Align decide to convert the spread bet position to actual equity holdings.

They equally could be short now through the spread bet as a possible hedge against profits made as I am pretty sure they took part in the placing at the tale end of last year so must be sitting on a decent profit already.

I hold ITV and remember six months or so back Goldman Sachs built up a huge position through CFD's from memory to the short side so can't add much to the mystery other than benefits I can see for Align are spread bets/cfd's would work well to hedge accumulated profits and if they are long on the spread bet they might have only had to pony up 25-50% of the capital needed compared to buying similar exposure through the direct equity.

[ladeside] 23/3/2021 17:16

Thanks Clarea.

So, does that mean that the additional 3.29% which takes Align up to 9.58% is still held as actual shares by Align ?

I'm just finding it strange that the purchase of 40 million+ shares hasn't really registered on the daily trades and even stranger still, hasn't had any positive effect on the share price, in fact it appears to have dropped !!

I'm also a bit perplexed at all the large trades which have been appearing over the past couple of days as they would seem to be at least 10% - 20% below the "ask" at the time of execution ??

The huge 102 million and it's pals the 15 and 10 million from Friday also remain a mystery as they account for 10% of the company but no TR1 has as yet materialised.

All very strange and I'm just wondering if some sort of financing deal / placing has been arranged behind the scenes at around the 0.50 mark ???

I'm sure all will be revealed soon......

[clarea] 23/3/2021 10:20

Just double checked with cfd's you do own the shares hence rns overall holding position would increase but as mentioned before main attraction is being able to trade on margin same as putting down 10-20% deposit on a house you still get 100% of the gain but only takes a 10-20% drop in this example to wipe out your initial stake.

[clarea] 23/3/2021 10:14

Ladeside re Spreadbets and CFD's main attraction is they can trade on leverage so say only have to put down 25-50% of what they would on direct equity purchase also no cgt on gains obviously higher risk way of trading as possible losses also magnified.

Its a complicated area and one I'm certainly no expert in but with CFD's I don't think you actually end up purchasing the actual stock they just run for a set period of time and at the end of that you either receive the relevant profit or pony up the relevant loss hence the name contract for difference you.

[volsung] 23/3/2021 09:27

Interesting articles
Sold all mine this morning
Looks well dodgy

[orange1] 22/3/2021 23:08

And there's more here:

[ladeside] 22/3/2021 18:54

The van niekerk bloke seems rather intriguing....

hxxps://www.timeslive.co.za/sunday-times/lifestyle/2013-11-10-exec-retracts-claim-he-bribed-spy-boss/



hxxps://mg.co.za/article/2015-02-05-sa-politicians-and-spies-named-in-guinea-mines-for-votes-rumpus/

[ladeside] 22/3/2021 18:44

vatnabrekk, Yes, over and above this if they have indeed increased their holding by nearly 4% then why does the share price drop rather than increase ??

I'll be honest, I'm not really sure how these SB's work or how they're even legal ?

How does purchasing / selling via these methods not have any effect on the share price ? Where do these shares come from and why don't they register or move the share price ??

What is the purpose of holding via this method ? is it tax related ??

What does it mean for the normal holders of shares and how does it affect them, if at all, should these SB shares be dumped by Align or whoever ??

I thought Align's reputation was built on transparency ? These methods of holding / trading would appear FAR from transparent....

[vatnabrekk] 22/3/2021 16:34

I think it's a bit off for them to question the IQ of investors, when it is perfectly clear that they haven't increased their interest by the direct purchase of shares.

[clarea] 22/3/2021 16:19

Align have increased but either using spread bets or cfd's rather than pure direct equity holdings, Re Heine Van Niekerk I would imagine he took part in the placing back end of last year as it looks like most of his holding was acquired in one go.

[bigwavedave] 22/3/2021 12:42

I didn't get this morning's RNS re major holdings. But Align say in a tweet:"Ref Ironveld #IRON Amazes us people cannot read a TR1. We have moved from 6.52% to 9.58%. Still believe there should be an IQ test before people allowed to invest in the stock market."

[tommygriff] 22/3/2021 12:20

There's a guy called Heine Van Niekerk appeared on the significant share holder register.Looks to be based in Johannesburg.

[tommygriff] 22/3/2021 11:56

Deffo an increase in aligns holding as they put a tweet out

[sabre6] 22/3/2021 11:10

I would like to know the answer to that one
To me it looks like a buy

[ladeside] 22/3/2021 09:44

Align and their spread bets.

Were they for or against ?

Not exactly the most transparent....

[bigwavedave] 19/3/2021 17:17

Does look odd. Why not a fall in the share price to 0.5p?

[ladeside] 19/3/2021 16:02

Something weird going on here behind the scenes.

Did anyone spot the huge 102,174,963 trade that appeared at 3.19pm today ? at a price of 0.50 ?? followed by a 5 million and a 10 million at 0.51 and 0.52 ??

Another 1 million at 0.60 just appeared just now and quite a few 300k & 500k tranches also.

I guess all will be revealed shortly......

[sabre6] 19/3/2021 15:40

sorry Under
My reply was to post 3592
I do also expect good things to come from Iron as well

[underhill2] 19/3/2021 15:03

Not sure what you are saying