PortfolioDirect tries to distinguish steak from sizzle. Strong or above average share price gains in the resources sector do not necessarily mean companies are adding value or have a viable development project. There is a tendency, within the sector, for short term price surges to be followed by a reversion to median (or worse) performance. The PortfolioDirect/resources research product (see (VIEW LINK), designed for investors directly managing their own equity portfolios, publishes analysis each week on companies whose share prices have shown above average momentum and asks whether the price action reflects steak or is simply sizzle . This week, the four companies reviewed are Cue Energy, Cape Alumina, Crossland Strategic Metals and Iron Road. On balance, the analysis has concluded that the sizzle exaggerates the size of the steak.
John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...
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