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Sometimes on stock markets, a company will go up for no reason, but you can kind of figure out why. Because its peers have run hard and punters are looking for cheaper counterparts, because it’s exposed to a certain commodity that overnight develops sex appeal, or perhaps because interested investors are getting in ahead of, or in the wake of, a dividend payout.
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But then there are other times where it really looks like somebody with insider knowledge may be snapping up shares ahead of a positive result. That’s what this finance journalist perceives may be the case for Godolphin Resources (ASX:GRL), up over +30% on Wednesday, to now sell at 3.3cps.
Exposed to both gold and silver at its Lewis Ponds project, perhaps it’s no surprise the market is throwing money at cheap juniors who may strike large quantities of gold or silver.
But then there’s liquidity (measured by share volume turnover), and that’s really where this finance journalist gets curious. Using ADVFN’s ASX Top Movers board, one can clearly see Godolphin is by far one of the most sharply supported stocks on the ASX today, despite being a relatively obscure company.
Indeed, heading into lunchtime trades through this Wednesday, over 40.5 million shares in Godolphin have traded hands.
That’s ten times the four-week average of 4.4M, which is the average amount of shares that have traded hands day by day over the last thirty days. Because that’s an average, one could safely presume it’s usually less than that, or that there was one or two days of low trades that threw off a higher read, but if GRL was being traded at higher volumes every day, it wouldn’t be an obscure company.
So this Market Link finance journalist is left to assume someone, somewhere, knows something – or that a whale-sized investor has just taken an absolute punt on the company. But that kind of thing is fairly unusual, especially if someone with real money has a safer place to put it, say, bonds.
One to watch over the coming days and/or weeks. HotCopper‘s not implying any criminality; just noting the unusual volume dynamics behind GRL on Wednesday, which may be consistent with certain decision-making.
GRL last traded at 3.3cps.
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