Resverlogix (RVX.TO) is a development stage biotech and Lithium Americas (LAC.TO) is a junior lithium mining company. At first glance you might think the two have absolutely nothing in common, but dig a little deeper and I can see some definite similarities.
I view both of them as miners. LAC is the more obvious, seeking to mine lithium to meet exploding demand at a time of limited supply. Resverlogix is also mining, but in a more metaphorical sense. This development stage Canadian biotech is ''mining'' for a treatment of cardio vascular disease (CVD) for patients with diseases like diabetes.
I engaged in a little trading today (Thursday Aug 25, 2016), taking some profits on LAC with some of the proceeds being used to increase my position in RVX. Both (sic) of my regular readers are well aware of my favourite bromide, ''you'll never go broke taking profits''. I sometimes need to remind myself of that when I'm sitting on significant gains, which was the case with my LAC holdings. I didn't sell out my entire position, a little over one third.
I still like Lithium Americas, a lot. But the junior lithium mining space has become very crowded with a number of recent entries engaging in heavy promotion to attract investment. LAC has seen its PPS falter meanwhile after spending a few weeks over $1.00 in June and July.
Meanwhile there are a few newly minted Lithium juniors making jumps despite a lack of feasibility studies, construction permits or partnerships with established players. But that's life with high risk speculative penny stocks. The dust will settle and there will be big winners and big losers. Many will find the stock that they saw being touted by an email blast or from a flashy ad that showed up on a sidebar....that it wasn't the pot of gold they thought it was.
SQM has been getting some press of late, and given the 50/50 joint venture they have with LAC I still like the chances for their Argentinian mine to enter production and for LAC to really catch fire. But it could be a while before that happens, and there are always risks....it might not happen at all. So taking some profits made sense to me.
Resverlogix is another matter, I view RVX as being incredibly undervalued right now. And there have been some recent developments that have caused me to raise an eyebrow. The first thing that caught my attention was the cancellation of the Annual General Meeting (AGM) which was slated for Oct. 5th. The cancellation was announced without a PR, instead a filing on SEDAR was issued.
There has been nothing further from the company, however some message board participants have reported receiving word from the company that the AGM has been rescheduled, but that the details are not going to be released until the agenda is finalized. I take message board chatter with a big grain of salt and sent a message to the company myself yesterday that hasn't yet been answered, I sent another today.
Then today at 1:05 PM I saw some trading activity that caught my eye. A firm by the name of AltaCorp engaged in 14 trades by my count on the buy side. I tabulated it at 10,500 shares with the buys starting at $1.20 and ending at $1.24. I'd never seen or heard of this AltaCorp before and it turns out, like Resverlogix itself, they are based in Alberta....hence the Alta part of their name I assume, a common short form for Alberta.
In looking over AltaCorp's website in the about section, I didn't find anything about them providing brokerage services to individual investors, They seem more focused on the investment banking side with M&A and equity financing type activities. The sudden appearance of AltaCorp on the day's reported trading along with the cancelled AGM led me to speculate that maybe something was and is brewing.
That combined with a check of the chart pushed me to take some profits on LAC and to use some of the proceeds to increase my RVX position.
Its all mining in my view, whether its to find lithium or an effective treatment for Diabetes patients....here's hoping they both strike pay dirt.
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