Chapter 16: Impact of exploration, development and expansion
The listed resources sector provides investors with a unique opportunity to participate in exploration successes and a significant increase in the value of their shares that can be achieved over a relatively short time frame. The value of a company can increase many times overnight, if the initial drilling results indicate the potential for a major find. However, it takes time — with further drilling, feasibility studies and capital funding — before the discovery can be brought into production and the true value of the deposit realised.
The risk (after the initial scramble by investors wanting to get set in the stock for the ride-up in value) is that the share price may fall as the ...
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