Talison Lithium Doubles since going public on TSE in September!

Back in September, just prior to Talison Lithium listing on the TSE (after the takeover of Salares Lithium) I made it my conviction stock pick, predicting that TLH shares would double by Christmas and double again by spring.

Half of that prediction has come to fruition as Talison shares traded at $6.60 last Friday (Today trading at $6.79)  Since Talison went public at $3.30 per share, that is a double, and it occured several weeks before Christmas.

Talison Lithium, the largest pure lithium producer in the world, is going public!

 In June I wrote about how the market for the electric metal (Lithium) was heating up and I highlighted five  junior lithium miners that stand to benefit from the coming "second leg" of the lithium Bull Market (Fall 2010)

Then in early July I told you about Salares Lithium and its Salares 7 project in the Atacama Desert of Chile, how vast their new holdings were, and how they might be a takeover target as this bull begins its second leg. It was my thought at the time that, because of an overstake of the Salares property by SQM (the largest brine producer in Chile) I believed that SQM might make some sort of offer for Salares.

However, within days of that article in which I made Salares my conviction stock pick, Talison Lithium, a private company from Australia, swooped in on Salares and a merger was announced combining the raw holdings of the Salares 7 project in Chile with the Two producing plants that Talison operates in Australia to mostly supply the burgeoning Chinese market with Lithium. Talison is the largest supplier of the commodity to China at this writing, supplying 66% of Chinese demand.

On Sept 17th, that merger should be completed and the stock of a new company (TalisonLithium Ltd is going public) will launch on the TSE. This will be the largest, pure lithium company in the world and thus the new lithium ETFs will have no choice but to place it near the top of their basket of stocks in the lithium sector.

Salares shareholders (as of the merger announcement) will benefit to the tune of approx 98.2% as their shares will increase from the .62 at time trading was stopped, to approx $1.25 when the new company begins trading on the TSE in Sept. (2.81 shares of Salares for each share of the new entity, striking price between $3.50 and $4 returns over 1.25 to Salares Share holders).
However, this writer will be holding on to his shares of the public version of Talison Lithium, as it will have to be listed in the new Global X ETF recently announced on the NYSE and Lithium indexes which are popping up on the radar screens this year.  Lets face it, in any market, indexes and ETFs cannot afford to ignore the world leader, and in this case, it will be the worlds largest pure lithium play.
Talison operates two producing lithium plants at their Greenbushes operation in Australia. It  has 25 years of production under its belt, supplies 300 companies with lithium and lithium carbonate, including many in China where it is the largest offshore supplier into that market. In its latest announcement of the merger with Salares, Talison management advise they are on track to ramp up production by 100% by 2011 and have many more potential customers knocking on the door at this writing.
That 100% increase does not even include the Salares 7 project in Chile which it acquires from Salares Lithium but it appears there are big plans for that area as well.

Yes, I doubled my money on this trade, but I believe it will double again well before Christmas, and double again before spring.  Maybe sometime in 2012 I might think about selling this stock, then again, when you are on a rocket ship, it is a bit hard to jump off.
Here's to your retirefund.
HP
Electric Metals Market heating up 
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Salares Lithium stock holders will double their money as Talison Lithium of Australia swallows Salares.

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News: Hertz and Enterprise to rent Nissan leaf starting in January!
This is an update for those of you who took my advice and bought Salares Lithium in early July for around .60 cents per share. While their is a current hold on trading this stock (LIT-TSX-v) it is by no means a time to worry.  It is a time to rejoice, because you have just doubled your money, at the very least.  Here's why!
About Salares Lithium Inc.
Salares Lithium Inc. is a lithium explorer in Chile that controls the 'Salares 7' lithium project made up of seven salars (brine lakes that are prospective for sub-surface lithium and potassium) and the surrounding concessions in Region III, Chile. Five of the seven salars are clustered within 155 kilometres and are 100% owned by Salares and its Chilean partner.
About Talison Minerals Pty Ltd 
Talison Minerals Pty Ltd is the leading global producer of lithium. Talison mines and processes the lithium bearing mineral spodumene at the Greenbushes Lithium Operations in Western Australia. Talison has an extensive, well established global customer network and a leading position in the growing Chinese market.(Talison produces over 65% of the current lithium being imported by China)
Talison and Salares are merging into what will be the largest pure lithium producer on the planet, and the "only pure lithium production company" to be listed on the TSX (not the venture exchange). That will occur on Sept 17th.
I have spoken with Salares CEO Todd Hilditch and company consultant, Matt Johnston who assures me that the new company (he will provide the stock symbol in the next few days) will strike somewhere between $3.50 and $4 per share when it is launched on TSX in September. At that time, Salares share holders will own 1 share of the new entity for every 2.81 shares they hold of Salares Lithium (LIT)
With a price cap between $340M and $350M, this equates to approximately 35.6 % of the new entity will be owned by current Salares shareholders which should return approx $1.25 per share, or more to those of you who took my advice 3 weeks ago.
If the TSX-v allows trading in Salares over the next few weeks, I will not part with many of my own shares. (of course I will take profit on a portion - maybe 15-20%) as I see this as a strong, bullish move for our holdings.
The new company will be the only lithium producer listed on the TSX at a time when the electric car market is gaining momentum, and new lithium ETF's are popping up on the NYSE.  

The Global X ETF will have no choice but to list the new company as the largest pure lithium supplier into China. If you invest you should do so "before" this occurs.


The combined company will have to be included in the new Lithium ETF's, as a front runner in the lithium space supplying the huge Chinese market and developing the huge Salares 7 project that Salares Lithium brings to the merger table.

When the new entity launches on Sept 17th on TSX, look for the strike price to pop. There is no way this stock will stay under $4 per share after it is launched. We think this new company will be a home run.

Your welcome folks, and here's to your retirefund.
HP

BNN interview with Salares CEO Todd Hilditch

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Top dividend Stocks you should consider for your Retirefund!

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Dividend paying stocks are good for your Retirefund! They are "very good" for your Retirefund! You pay less tax on dividends than you pay for almost all other income. Companies that have paid dividends for many years can usually be found at the top of the market where they are listed.

Here are 12 top Canadian dividend paying stocks listed on the Toronto Stock Exchange and also listed on the New York Stock Exchange. These are solid performing companies that have high dividend yields. You should consider them when constructing your Retirefund outside of an RRSP.

S.No.	Company	Ticker	Market Capitalization as of April 23, 2010	Dividend Yield
1	Bank of Montreal	BMO	$36.0B	4.32%
2	BCE Inc.	BCE	$23.7B	5.63%
3	Canadian Imperial Bank of Commerce	CM	$29.8B	4.57%
4	Enbridge Inc.	ENB	$19.2B	3.31%
5	Rogers Communications Inc.	RCI	$20.9B	3.60%
6	Royal Bank of Canada	RY	$87.7B	3.24%
7	Sun Life Financial Inc.	SLF	$17.7B	4.59%
8	TELUS Corporation	TU	$11.7B	5.20%
9	The Bank of Nova Scotia	BNS	$53.4B	3.77%
10	Thomson Reuters Corporation	TRI	$30.6B	3.13%
11	Toronto Dominion Bank	TD	$66.3B	3.17%
12	TransCanada Corporation	TRP	$25.7B	4.29%

If you are looking for steady income, taxed at a low rate, for a long time. (In other words, you have a solid nest egg and now want to start enjoying life instead of tracking stocks) then you should be invested in solid, dividend paying, blue chip stocks, and these are a great place to start.

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Apollo Gold Corp - Undervalued and Unappreciated, for now!

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In our previous article : The argument for Gold, we first updated you on Gold's value in this market, and the hidden gem that is Apollo Gold, and it's Black Fox and Grey Fox Mines near Timmons Ontario. The story just got a little more interesting today!

Apollo Gold announced today, the assay results of 7 holes (out of 29 drilled) during it's drilling program in August at it's Grey Fox site and those results are excellent! We are still awaiting the results of the other 21 holes which should be released near the end of October.

This reinforces my reasoning for increasing my holdings through Sept and Oct and I believe there is more good news to come. Gold Analysts from The Gold Report had this company at a strong buy before the drilling at "Grey Fox" even began, with a minimum target price between $1 and $2.79 (it is currently trading at .58) Those estimates were solely based on Apollo's new production at it's "Black Fox" Mine (approx 40,000 oz) since June and did not even consider the drilling at Grey Fox nor Apollo's recent acquisition of the 3.5 km "Pike River" property which straddles these two diamonds in the rough since it started drilling core at Grey Fox.

I expect those estimates to be greatly revised upwards over the next few months and into the 2010 Q1 reports. Here are those initial Assay results from Apollo Gold.

Apollo Gold Corp - (TSX: APG / NYSE Amex: AGT).

PS: I would like to address a comment about gold investments by the venerable oracle of Omaha, Warren Buffett who said: " Gold gets dug out of the ground in Africa, or someplace. Then we melt it down, dig another hole, bury it again, and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their heads"

Gold has, in fact, great utility! Gold is the best conductor of electricity on the planet. If it were not for the high price (and high utility value) every household would have gold electrical wires instead of copper. Every electrician out there knows this simple fact.

Gold is used in Medicine, Dentistry, Industry, aeronautics, space flight, electronics, computers and food production not to mention the massive international jewelry trade and as a hedge against devaluing currencies.

With the new discoveries for gold tipping in the nano manufacturing of future solar panels enabling 100,000 times more electrical conductivity, and other gold applications in nanomanufacturing, anyone who believes that Gold has no utility, is not paying attention!

Currently, The Chinese Government is buying gold, and telling it's citizens to do the same. The Hong Kong government is actually in the process of moving it's gold reserves from London Banks, to it's own territory. In places as far flung as Istanbul Turkey, and Indonesia, people are buying up gold as a store of value against what the world perceives as a quickly weakening U.S. dollar. Gold has a 6,000-year history of preserving value against fiat currencies like the greenback.

Having regard to the above, I believe that, 2,000 oz gold is the "low end" of what is coming in 2010 and I believe that Apollo Gold is severely undervalued.

Update Oct 23rd - Apollo Gold signed an agreement with Elkhorn minerals to sell it's interest in the Montana Tunnels for $9 Million. This is another clear indication that Apollo Gold is clearing it's slate to concentrate on it's Grey Fox and Black Fox properties near Timmons Ontario which may be the largest pure gold discovery in the past 30 years.

Analyst Reports on Apollo Gold:(Which don't include the Grey Fox Drill Results)

1. . . .We continue to recommend the shares of Apollo Gold Corp. with a SECTOR OUTPERFORM rating."
-KERRY SMITH, HAYWOOD SECURITIES (10/16/09)

2. "We have left our assumptions for 2010 unchanged, resulting in no effect on our $1.00 target price and SECTOR OUTPERFORM rating" for Apollo Gold.

- -TARA HASSAN, M PARTNERS (09/30/09)

3..."Apollo Gold is very much a strong buy, an aggressive buy".

-Jay Taylor - J. Taylor gold Letter.


Update: Nov 2nd 2009 Reuters reports six more drill assay results from Apollo Gold!


Update: March 2010 Apollo Gold swallows Linear gold

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New York and London losing market share as electronic exchanges on rise.

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The New York Stock Exchange (NYSE) now NYSE/Euronext, founded in 1909 is under attack. Not from terrorists, but from upstart electronic exchanges that are continually taking market share from the "Big Board"! As of this date, only 37% of "all" trades in the USA are actually conducted on NYSE.

The rest are conducted on smaller, more nimble, electronic exchanges, known mostly to only the brokers and trading companies. Some are considered "Dark Pools" where major traders have an advantage of seconds over average investors, and not even the SEC or other regulators actually have an indication of just how much trading occurs.

NYSE is fighting back with it's ARCA exchange in Chicago which conducts about 11% of all trades, and holds sway in the giant Derivatives Market. It is also building electronic trading centers in New Jersey and London.

The largest upstart, however, is a direct competitor which is not much known outside of trading circles. The "Direct Edge" Exchange is located in Jersey City and may conduct as much as 15% of all trades conducted in the United States.

The "BATS" Exchange is a small, quiet operation in Kansas City Kansas, far away from the hustle and bustle of Manhattan, but doing about 11% of the nations stock trading. As a direct result of all of this activity, the NYSE/Euronext has lost almost 75% of it's stock value, traded on it's own exchange. The Canadian TMX group is also quietly researching U.S. cities for a stake in the game.

Even the venerable London Stock Exchange (LSE) is under pressure from smaller exchanges popping up on the continent. After dominating trading in Europe for 208 years, the LSE is losing business to upstart electronic exchanges at a fast rate. Up from only 8.5% last year to over 20% this year. Small upstarts are taking market share at unprecedented speed. Speed? Well that is the issue, isn't it. At this writing, the LSE is in talks to buy an electronic exchange called "Turquoise" which was set up in Europe by seven investment banks including Goldman Sachs and Morgan Stanley. London recently bought a small tech service company called MillenniumIT located in Sri Lanka. We are indeed investing in a Global village of trading platforms now.

Many of these upstarts got their start from disgruntled traders and investment houses tired of the huge fees and glacial movements of these monoliths of the capitalist system. Basically, 18th and 19th century ideas for trading don't really belong in the 21st century. The basic premise of trading does, but not the execution nor the idea that a privileged position on an exchange should give one segment of the investment community, the upper hand over others. Ominously, the "others" have now gained a similar advantage utilizing super computers and "flash trading"! No doubt, it's the same old crowd with new toys and a new privileged position. The more things change, the more they stay the same. "Wall Street" as it is referred to by the media these days, is not actually a street in New York anymore, but a club of high speed traders, in various pockets of electronic trading circles. As George Carlin once said "It's a big club, and your not in it"!

Being the catalysts for biggest players in the "Big Club" the NYSE and LSE are being hauled kicking and screaming into the 21st century. People don't give up privilege easily, unless, of course, it is replaced by more privilege. In the mean time, the smaller, more nimble upstarts will gain market share, and that gives opportunity to small fries like us.

In Chicago, which has dominated the derivatives market (futures, options etc) for almost as long, the same thing is occurring. CBOE, CBOT, CME, CFE have consolidated and merged operations to try and fend off high speed electronic futures exchanges and Options Exchanges like the ISE, ICE, ELX, OMX, OneChicago and EUREX, etc. There are also many trading companies that have developed or are developing their own, proprietary, electronic trading platforms. The exchange business is now a horse race, no longer dominated by the old favorites. It is Capitalism at it's best, and it's worst. Could this race be the next catalyst for calamity in the markets? No one knows for sure. Today the U.S. is implementing a strategy for regulating of the Derivatives Market.

If you are betting on this race, bet on the smaller, faster horses to win in the "short term". But don't discount the big dogs in the long run. That is why they are called big dogs.

Good investing

HP

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