Cant believe that this conversation is continuing. IMO...

Cant believe that this conversation is continuing. IMO artificially propping up ‘likes’ to look good borders on being juvenile, so I side with Caracalla.

That said, can I introduce something more controversial on this wonderful Friday afternoon. Few will disagree with the basic premise that if demand exceeds supply, the price will go up and of course the converse of this.

I would like to suggest that where new starts / speculative stocks attract EARLY support from a wide group of ‘extremely high conviction’ investors who collectively add to their conviction that a share is a long term play which will present significant returns, then this has an undermining effect on the buy side pool. Take today as an example. A mere 1.6 m shares have changed hands across the ASX and Chi X as at lunchtime today.

The collective buying power of the HC pool alone, given conviction levels could easily stimulate the demand side. Why is this not happening ? IMO, the reason is simply that everybody has their fill. Be it those that are at the extreme end of the equation (all-in or one stock ponies), position sizing disciplines or cash limitations. I would argue that this is having a direct impact on the liquidity of the stock.

Anybody who has motive to sell, other than profit taking (those looking to achieve the highest possible exit price), can lower the price with little resistance. Having a stronger register with greater fund involvement would not necessarily change this in that even funds follow disciplines on holding limits.

What I am saying is that too much too soon may be to the detriment of share price appreciation VERSUS the steady build in conviction over time and a comparable build in demand . Another way of putting it would be, if everybody on HC sold half their holdings of Nuheara today and embarked on a buy- back of the collective stock sold over say the next 6 months, would this present greater resistance to Seller’s ulterior motives. I say yes, but I am not selling my shares.

I am sure this will illicit a wide range of thoughts and probably some abuse, but controversy can be healthy, entertaining and educational.

Have a great weekend.
Rokewa