Trading the stockmarket (NO Referrals)
- Thread starter mcast123
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Associate
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All because of a blogger who misrepresented the facts, got all the sums wrong, and doesn't understand what were trying to build here. Caused a PI panic and it beats me because all information in the blog (that was correct) was already public. Two institutions have added and Edi personally added 500,000 shares on Friday.
Here's an article from an interview with Edi Truell from saturday:
Edi Truell is hitting back after a sceptical analyst’s note on his latest venture
It hasn’t been the easiest of weeks for Edi Truell. The financier has been put on the back foot by a surprise bear raid that, at its worst, wiped £75 million from the value of his ambitious new venture and put an £11 million dent in his personal fortune.
At the last count, no fewer than six hedge funds were betting against Tungsten Corporation, including credible sceptics such as Marshall Wace and Man Group. JP Morgan, that mighty American investment group, has also taken against it with a chunky and growing net short position equivalent to 2.69 per cent of the free float.
The trigger for the 34 per cent slide in the share price appears to have been a sceptical online demolition job by Matthew Earl, a former analyst at Charles Stanley, Tungsten’s broker. He painted a picture of Tungsten as deludedly overambitious, distracted by a pointless acquisition and running short of cash.
Mr Truell, best known in London for building Duke Street Capital into one of the City’s foremost private equity groups, is the founding chief executive of Tungsten — and clearly has been taken aback by the impact of the research note.
“I’ve been a private equity, private markets person for longer than I care to admit to and so public markets are a bit of a mystery to me — but I have been surprised that shareholders are interested in the recycled guff that the chap seems to be putting out. Rightly or wrongly, I have taken a view that I don’t want to get involved in a tit-for-tat.” He argues that most of the information in the attack had already been fully disclosed in the admission document that Tungsten published when it floated in 2013, or is irrelevant or mathematically suspect.
“From a business perspective, nothing was different yesterday from a month before. We are continuing to do our thing.”
“Our thing” is the creation of what he hopes will be a colossal business at the heart of the plumbing that connects the world’s biggest companies to their hundreds of thousands of suppliers. Tungsten operates an electronic invoicing platform that enables suppliers to bill large corporate customers in a compliant format that streamlines the process for both sides.
In addition, it is building a credit business that allows suppliers to borrow on the security of unpaid invoices and an analytics business that helps customers to improve their buying habits while cutting fraud.
It may sound a bit humdrum, but the numbers quoted by Mr Truell are anything but. He says that Tungsten is capable of huge things. “We’d like to process $1 trillion worth of invoices a year. We’d like to provide finance of $100 billion a year. And we’d like to save our clients $10 billion a year.”
That ambitious vision helped Edi and his brother Danny, the former investment chief of Goldman Sachs now running the Wellcome Trust portfolio, to raise £225 million in October 2013 by floating Tungsten on AIM, the junior market. They used the proceeds to buy OB10, the invoicing network, and later FIBI Bank (UK), which has been renamed Tungsten Bank and, he hopes, will become the heart of the invoice discounting business.
Mr Truell has some heavyweight backers, including Odey Asset Management, with a 13 per cent stake, and Fidelity Worldwide Investment, which last week topped up its holding to more than 5 per cent.
He concedes that there have been setbacks. The bank acquisition took longer than expected. Scaling up to be a global player — ensuring that the system is tax-compliant in every state in Brazil, for example — eats up cash. Yet it is one of the reasons that Tungsten is winning business from the likes of Apple, Nestlé and Vodafone.
Attempts to win funding from Blackstone, the private equity firm, and the state-owned British Business Bank have foundered, but Tungsten belatedly found a deep-pocketed investor, the BNY Mellon-owned Insight Investment Management, to finance the fledgeling invoice discounting division.
Mr Earl’s suggestion that the bank acquisition was unnecessary has stung. He tweeted: “Buy a loss-making business. Buy a bank. Add a button. What is it worth? A button.”
Mr Truell’s response? “I think he’s being too parochial.” Some countries, such as Germany, require invoice discounters to have a banking licence and the bank label confers authority and credibility.
He also rejects Mr Earl’s suggestion that Tungsten will call on its investors for more cash, although he gives himself a little wriggle room with two caveats. A big enough contract win from a big customer might require upfront investment, while Tungsten may want to invest as principal in some invoice discounting business if it looked attractive enough.
Mr Truell, who spent last week hosting a conference for customers and prospective customers from 92 of the world’s biggest businesses, is a cheerleader for the scope of invoice analysis to save bucket loads of cash. Large corporations often don’t know what they are spending on or may not be fully exploiting scale economies. One client, the US Department of Veteran Affairs, which runs hospitals, was buying sterile dressings from no fewer than 104 suppliers, he says.
Mr Truell claims that his system can reduce a client’s procurement costs by between 1 per cent and 4 per cent. He is so confident that he can save big business money that in one case he has priced a deal so that Tungsten gets nothing unless it delivers cost savings.
He recognises that the jam tomorrow philosophy can be frustrating for shareholders, but says grand ambition can pay off. He also argues that the biggest returns often require hefty upfront investment, pointing to Pension Insurance Corporation, which he co-founded in 2006.
“We spent £70 million before we earned a single penny in revenues,” he says. PIC, which buys out pension liabilities from employers wanting to end responsibility for their final-salary schemes, is now thought to be worth more than £1 billion.
Mr Truell reckons that over 22 years his investments, including the occasional duds, have overall delivered a 30 per cent annual return. That success has allowed he and his brother to put millions into favoured charities, including conservation projects in Africa and the Galapagos Islands, where he is backing efforts to save the Galapagos penguin, which faces a 30 per cent probability of being extinct within 100 years. (seemingly a penguin lover, his holding company is called Rockhopper Investments.)
Mr Truell is also working to reform inefficiencies in council pension funds. Hired by Boris Johnson to chair the London Pensions Fund Authority, he is trying to address the waste of more than 100 council funds each having their own expensive roster of consultants and advisers.
Under Mr Truell, LPFA, which looks after the retirement benefits of 60,000 present and former firefighters, police officers and council workers, has signed a deal with Lancashire to pool assets and prune fund managers and with Manchester to invest jointly in infrastructure.
Mr Truell’s goal is to improve returns by 0.5 per cent a year. That performance, replicated across the entire council pension industry, could save future council taxpayers billions.
Yet with Tungsten shares languishing at less than half the 340p price of a capital-raising last September, his immediate priority is to restore shaken confidence in Tungsten. He made a good start yesterday afternoon, when the company announced that he had just bought an extra 500,000 shares, a fillip that sent the price sharply higher for the first time in days.
Q&A
Who, or what, is your mentor? My brother Danny has probably been the best and closest since we started investing together 35 years ago.
Does money motivate you? Having been financially successful enables me to pursue my motivations: I really want to change the world with the things I do and, eventually, do my bit to make it a better place.
What was the most important event in your working life?Being trusted by Hambros in my early twenties to put together private equity investments.
Which person do you most admire? Margaret Thatcher. She disruptively transformed the moribund British economy.
What is your favourite television programme?Yes Minister still holds true today — and is wickedly funny.
What does leadership mean to you? Have the vision, and then lead from the front to make it a reality.
How do you relax? Playing Bach on the piano. Or ski touring.
CV
Age: 52
Education: Wellington College; University of Durham, studying economics and finance
Career: initially Bankers Trust, New York; 1991: joined Hambros Bank; 1994: chief executive of Hambro European Ventures, later Duke Street Capital; 2000: founded DSC Debt Management; 2007: founded Pension Insurance Corporation; 2013: founded Tungsten Corporation; 2013: chairman of the London Pensions Fund Authority
Family: Divorced, four sons
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Understand the business, understand the market. Understand your risk profile. Don't listen to tips from anyone.
By assessing what you are prepared to lose....(not that you will but very well could)
Soldato
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Research works too, the questor tips are researched I think. Its still possible they asses or misperceive data or changing trends but I wouldnt ignore any indepth information or report like that. Just a simple one liner tip is no more then a fortune cookie 
Stick all your tips in here, timing counts for a lot too. Especially with aim companies
http://www.stockchallenge.co.uk/site/forms/subform.php
Stick all your tips in here, timing counts for a lot too. Especially with aim companies
http://www.stockchallenge.co.uk/site/forms/subform.php
Are you sure? The announcement was to be on the 3rd March I thought. Either way, its broke the 260p mark all week last week which means Im pretty much evens on Barc now. Hopefully its on the up and up
Yes sorry my mistake its due today. I was not pleased with the results so got out this morning at just over 260p. I was planning to hold out for around 300p but decided to ditch it in the end. Made only 16k and held for ages but better than a loss.
Results (IAG) are in, very good but no talk of a dividend
Think it time to sell, looking at 2.8k profit, nearly 50% up since I bought 
It not all good news though, lets not talk about Tullow Oil
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Associate
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I'm keeping my 16,000 shares as a long term hold. Will cause disruption in the SME financing space. Will be £20+ in the years to come. Going to add when the new tax year starts. Current share price weakness is all noise due to quantitative shorts and PI panic. I'm standing firm againsts the shorts.
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It's worth getting a little portfolio going rather than sinking everything into one share, unless you like gambling i guess.
Associate
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How are tobacco shares affected by budget announcement in general if anyone knows?
Thanks
Thanks
Soldato
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The market will have already factored in the changes to tobacco duty the only way they will react to the budget is if the chancellor does something unexpected (i.e. something that hasn't already been leaked).
Associate
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Thanks.
Read the Naked Trader guide. Learn about falling knives and tea cups.
As mentioned invest in relatively safe companies where you understand the product(s) etc they flog and decide if there's room for growth.
Then after a year decide it's probably best left to the experts once you've lost about 20%.
How big is the UK market for cigarettes?