Altyn Gold (LON: ALTN) shares are down 8% in London this morning. This off the back of the first quarter results as announced. Yet we were, only a few weeks back, recommending Altyn as a useful little speculation. So, what happened? Were we, horrors, wrong in our suggestion? No, obviously not, that couldn't be. But rather more important than any claim to omniscience we might have we were commenting upon a speculation in Altyn that dependent on a very specific conjunction of events. And this is the thing about specific opportunities. Once they've happened they're gone - and they also don't have any influence upon the more general prospects for the share or instrument concerned.
Altyn Gold has announced Q1 results: “Revenues at USD11.15m were temporarily impacted by reduced volumes given maintenance activity as noted at the crushing facility.” Ore mined hasn't varied much, the crushing plant was out for a time so ore milled is down, lower grades are being mined, gold produced down significantly. Most of which was already known and comes as no great surprise. Still, shares down 8%. So, why did we think there was an interesting speculation in Alyn?
Altyn Gold share price from London Stock Exchange
The answer is that we reno;t commenting upon anything so boring as the levels of gold production. Instead we'd noted a very specific issue. Altyn wasn't going to be able to file its accounts on time. Therefore there would be a suspension of the share quote. That dropped the share price by 22%. Which is fair enough. Except at that same time Altyn said that the suspension was going to be very temporary. ALTN also provided an (unaudited, obviously) update to the ongoing figures. It was possible to assume that the 22% drop was overdone and would be reversed as and when the suspension was lifted.
Which is what we suggested would be an interesting speculation. As it turned out to be. The suspension was lifted, shortly, and the stock jumped 20% when it did so. That's that sharp U-shape in the Altyn Gold share price around 5 May and following.
Now, we don't claim omniscience, however much we might joke about it. But we do insist that this following is a simple truth. If there's a specific reason for a speculation - say the suspension of a share - then when that specific reason is passed then there's no specific situation in that share any more. The initial analysis was “look, this!”. And when the “thus! has happened then we're back to the general fog about that share's prospects.
That Altyn's suspension provided an opportunity tells us absolutely nothing about Altyn's mining that is. So, speculations based upon specific situations need to be closed out when the situation has passed - we don't let specifics run that is.
