The article regarding iron ore share price was all over the financial news today, "China demand could send iron ore price up 30 per cent". Goldman Sachs JBWere commodities analyst Paul Gray said iron-ore prices will continue to rise until 2010 as demand outstrips supply. While it is certainly gave a big boost to Rio and BHP, there are few Iron ore producers, or even explorers that benefited from the price increase.
One of them is MGX. Just ten days ago at 18th of September, I bought MGX at $ 1.97 per share (I started watching it few days before at $1.85 per share), and now it is sitting at around 20% profit. I wasn't very lucky with ADY (Iron ore producer and explorer in South America) before. The share price was quite stagnant at the time of my holding, so I decided to sell on a loss to change it over to MGX. I'm very happy with my decision, although, ADY share price was also moving up after I sold them :(
Back to the MGX. One of the reasons I bought MGX is because it is a 'pure play' iron producer. I am trying not to buy pure explorers anymore (with the exception of DYL), because I've got burn in most of them before. The chart for MGX was also quite impresive, and apparently is good a value!!
E.L. & C. BAILLIEU Stockbroking Ltd., Macquarie Research Equities, and Merrill Lynch (int) rated MGX as a "BUY"
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