The Losses of 08!!

I think one of the 1st things I should do is face my mistakes and losses, write them all down in one place and look at them. Acknowledging them is imperative before I can truly move on.

It would be easy to dust of the losses of last year and not mention them again. But I feel I need to face them so here they are.

Aim Resources
Arasor Ltd
IBA Health
Beach Petroleum
Prime Retirement
Destra Media
Macmin Silver
Equinox Minerals

Ouch this is a bad looking list...

AIM Resources

I bought $49,730.49 worth at a average price of 0.166 and sold the lot at a average price of 0.036 for a loss of $38,830.49

Why I bought;
This was a start up mine due to go into full production in 08, the zinc price was good and profitability was meant to be high

The problem;
The Zinc price tanked (90% fall) , the company failed to hedge forward production during booming prices. Due to fall zinc prices they couldn't get the last 50 odd mill to finish the mine.

My mistake;
Failing to understand the growing problem of the plummeting zinc price, not understanding that hedging during a boom is a must, to at least guarantee the mines viability during the 1st 3 years. Not understanding the looming credit crunch would impact small miners getting access credit to finish projects. Averaging down was biggest mistake here!!

Arasor Ltd

I bought $23,020.00 at a average of 1.644 and sold all at a average 0.25 at a loss of $19,520.00

Why I bought;
This was a tech company operating in the boom markets of India, the potential was massive. Also it was recommended from a tip sheet I was subscribing to at the time.

The Problem;
The earnings that where forecast where just not there. Too much hype not enough fact.

My Mistake;
Got caught up in a tip sheet hype, hoping the earnings would be there. Not believing facts

IBA Health

IBA is a e-health company. I bought $34,284.62 at a average 0.98 and sold at a average of 0.647 a loss of $11,636.12

Why I bought;
I bought because the product they where selling was good, in the primarily government health field.

The Problem;
No real problem

My mistake;
This is one a really regret having to let go, It's a outstanding company with outstanding prospects and a future, But I got margin called out of it in October. My mistake was over gearing.

Beach Petroleum

It is a mid tier oil producer mainly in Australia but spreading out more globally. I bought $10,622.42 at a average $1.296 and sold at a average of 0.859 a loss of $3,582.90

Why I bought;
Rising oil prices this looked a attractive investment, I still think it is

The problem;
Falling oil prices caused falling share price, causing a margin call

My mistake;
Over gearing, I would still like to hold this one, I still like the fundamentals

Prime Retirement Trust

Prime owns retirement complexes in Australia and builds them, I bought 10000 at 0.57 for my wife's income portfolio. I still hold at a loss.

Why I bought;
I bought for the income, and because the NTA was $1.00 , lots of room I thought, if things going wrong.

The problem;
Even knowing that they relied on assest revaluation for profits, this is no longer possible in the new era we are in. Dividends where cut then stoped. Sale of new units have dried up as retirees can no longer afford them, due to falling sharemarkets.

My Mistake;
Thinking a 50% in NTA was good enough, thinking retirement investment would be immune to global problems. I have written the debt over these off, the margin loan provider has eliminted them from there list. They are currently sitting at about 0.12c

Destra Media

Where a digital media company, I bought at a average of 0.24 with $2,400.00 and sold at 0.055 haveing a loss of $1,850.00

Why I bought;
Believing the hype from the tip sheet, again! Thinking that the company was at the cusp of a new frontier of online and digital media.

The problem;
Destra spent to much time and money buying other companies and thinking that that was growth. Debt balloned up, and profits where no where in site.

My mistake;
Yet again beliveing the hype, at least I managed to sell at 5c when one month later they called in the administrators .

Macmin Silver

Where building a silver in mine in queensland. I bought $9,900.00 at 0.165 and sold at 0.037 for a loss of $7,680.00.

Why a bought;
I believed the silver bulls that another bull run was around the corner, and I wanted exposure to it. I knew this company had had some problems , but full productions was just around the corner.

The Problem;
Bad management, problems on site, delay's in production, rising cost's of production, directors treating shares like they can be given away and diluting the company.

My mistake;
Jumping in on a average investment when I knew there where problems.

Equinox Minerals

Is building a large scale copper mine in Zambia, I bought $55,040.00 at a average of 4.403

Why I bought;
When the copper price was half it's height it was still a massively profitable mine.

The problem;
The copper price has dived, how ever even at it reduced price of $1.50 - $1.40 / pound it is still a profitable mine. They have hedged 30% production for the next 3 years. I still hold.

My mistake;
Only real mistake is to buy at $4.40, but who could forsee the price drop in copper so much. Either way I still of great hopes for this one, in the mid term , which is the term I bought for. Still profitable, looking forward to when the copper price recovers, this will easily boom back past what I paid.
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So all up a loss of $83,099.51 (only counting the ones I have sold)
That's not a pretty number, ohh well live and learn.....

AND LEARN IS WHAT I INTEND TO DO..................