#OXS OXUS GOLD , Risk ?

Thought I would right this at the start of 2015, NYE was a hell of a ride for ARMS, even though I was only there for 1 hour, two trades with a 100% profit and a 20% profit.

ARMS can teach us a few things, not all arbitration results have a suspension period, 300-400-500% rises can easily happen on AIM (even in just half a day). MM’s can play the good old auction trick(something they played on ARMS to freeze out most buyers until the SP had doubled). All this on just a $173m award win.

So back to OXUS, I noticed something was afoot yesterday when I at 9am I put an order in for a small top up of 200k shares from some of my arms profit. Broker said “NO” £2k max at 2.14….I then tried my second broker who said he could go to ISDX and get £2k at 2.2 but that was the most he could get.

It became very obvious that stock was very very tight…and that any upward pressure would result in a sharp upward correction. Which unsurprisingly is what happened when it rose very quickly on small volume, to smash intraday highs and closing highs over the last 12 months.

So what do we know, don’t know and can address?

I’ve taken a little flak in the past for concentrating on mm and L2 behaviour on OXS, as “it’s all irrelevant until the result is announced”. This isn’t something I subscribe to. As per above and as per my posting on the forums on the 30^th this was something easily anticipated, if not to quite this degree.

So our mass seller (probably the distressed RAB) stopped offloading, preventing the only real source of shares to the market. What we also saw was larger and larger bids 500k- 1M even on the bid seeking any shares. We don’t know why they stopped selling though.

We have the BOD saying that they expected the result end of 2014, we don’t know when exactly the result will be.

We have a BOD who extended the drawdown arrangement by 6 months to cover the decision, an extension that only has 2 months left on it.

We have ARMS, that proves that arbitration decisions can come at any time and where I have no doubt that people who made a lot of money in ARMS due to the decision will be looking for similar plays, such as OXS. The profit in ARMS would be enough to buy every single share on OXS, we don’t know how much of this money will flow into OXS though.

So where does this leave us?

Well ARMS received 100% of the money they sought which for OXUS would be $400-1.2bn.

There won’t be many shares available even before a result until at least 4p so further rapid rises are very much on the cards.

It could be that RAB have stopped selling, not because they have run out of shares, but because they have been advised otherwise.

What I do hope is that any new holders have a little bit of patience, as although a decision could come on Friday or next week, it might take a little longer than that. Arms with considerable debt and cash problems and a win against somebody where getting payment will be difficult, rose to 50% of the arbitration result. For OXUS that would give 40-50p.

The auctioning trick by the MMS close of play on the 31^st was very telling, buying anything worthwhile can be difficult sometimes I wouldn't be surprised to see an auction first thing Friday.

Good Luck and Happy New Year.

BUY-HOLD-HOPE