Sharechat Logo

Of Bulls & Bears

Friday 29th September 2000

Text too small?

Is kiwi too strong for investors?

Thanks to the low New Zealand dollar, our shares are said to be in the global bargain basement (again). Lately there have been rumours of foreign investors building up billions of dollars in currency options to give themselves the room to make a takeover bid or two. This is all very well but Ferdinand has not seen any evidence that local or international investors are piling into the market. Volumes have been light, the NZSE40 index is struggling to keep its head above the 2000 mark (again) and the price of our flagship company, Telecom, is showing little willingness to halt its precipitous slide. The good news is most investors appear content to hold tight for now. The bad news is the lack of activity from foreign investors can only mean one thing - they expect the kiwi to go even lower.

Odd Capital similarities

Both Southern Capital and IT Capital are investment companies prepared to take plenty of risks in the chase for big profits. Both have reported net losses in the past year, with Southern reporting a $1.4 million loss for the year to June 30 and IT Capital a loss of $2.5 million to March 31. Last month, IT Capital sold its stake in exo-net International to Australia's Solution 6 Holdings for about $12.7 million compared with an investment of $1.5 million. Southern has done even better with a stake in biotech company A2 corporation worth about $2.9 million compared with a $39,000 investment just six months ago. One significant difference between the two is in their share price performance. IT Capital has lost half its market value in the past six months while Southern Capital has nearly doubled.

Nerves jangle at Aquaria

Investors in failed aquarium company Aquaria 21 have seen their shares fall in value from 21c in February to just 2.7c now, a paper loss of 87%. Yet, despite this destruction in wealth, the company's major backers such as enterpreneur Eric Watson are holding on to their shares. Of the top 10 investors in the company, only one - the Aquaria 21 Trustee Co - has reduced its stake in recent months. Other shareholders have been less reticent, however. One notable investor, a company associated with Metlifecare founder Clifford Cook, has sold 78% of its 4.7 million share stake since May, presumably at a fantastic loss. It remains to be seen whether the holders or the sellers in this company are the smarter investors.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar rises as US-China trade, Brexit tensions ease
SkyCity shares hit 7-week low as fire encapsulates convention centre
Wrightson showcases Fruitfed Supplies as horticulture stands out
Fonterra rivals fear dairy giant will get leg up from law overhaul
Wellington Drive remains in the black as it raises operating forecast
OMV plans further maintenance at Pohokura
Sky continues sports drive with extension to netball rights
Apple's asset-shuffling puts $270m value on PowerbyProxi
Fonterra lifts payout forecast on improving global dairy prices
22nd October 2019 Morning Report

IRG See IRG research reports