T.ITE: iTech Capital (TSE) Message Board

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Gold/Mining/Energy : T.ITE: iTech Capital (TSE)

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To: Rob Davis who wrote (1983)	11/16/1999 10:10:00 PM
From: keith massey	Read Replies (1) of 5053

Just a little on one house selling/dumping since I have seen this one happen a bunch of times. There are numerous reasons why a company dumps at a loss. Although it might not make sense to us it normally makes good business sense for them. A great example is my good old friend BSX (Black Sea Energy). During a 2 month period back in June-Aug. 1998 one house was dumping stock like crazy and pushed the price down from $1.20 to .12. On the day it hit .12 Gorden went crazy and dumped 5,000,000 shares all in small blocks. I was lucky enough to load up <ggg> Message 5422330 To: keith massey (0 ) From: keith massey Wednesday, Aug 5 1998 8:19PM ET Almost all of the selling during the past two months has come form one house (81 Gorden). They have sold more than 6 million shares during the past month and have only bought 250,000. They have managed to drive the price of this stock from 1.20 two months ago to the current price today. Every other house has been a large net buyer during the past couple of months. As soon as Gorden runs out of shares this stock should recover back to normal levels. I ask Barry Harrison (ex. pres.) yesterday why he thought Gorden was dumping. I was told that Gorden was one of the underwriters of stock last year during the IPO and get redemptions for their stock. .... I guess I hit the nail on the head with that post. As soon as Gorden ran out of shares the stock started a steady move up and tripled in a couple of days. It changed its name to IVANHOE ENERGY (IE) and ended up going to $4.90 almost a year to the day it sold down to .12. Now think about this...Gorden sold off 5,000,000 shares for .12 which was worth $600,000. If the house would have held one more year that stock would have been worth $25,000,000 at the peak. However they did the IPO for the stock at $4 so depending on how the redemptions/captial loss, etc. worked they could have written off a similar amount so in the end it didn't make much difference to them. My point here is that when one house (or two) is dumping and the rest are buying often the house dumping is not taking the value of the stock into consideration. I sure know 81 Gorden wasn't when they were dumping BSX. One of my all time favorite buys is when I find a stock in the position like JDX was in the other day with only one house dumping (GP) and everyone else buying (17 houses). Best Regards KEITH

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