Chinese stocks and ICP numbers

Chinese Internet users face restrictions as to the websites that they can and cannot visit as China censors the Internet.  It makes sense for Chinese companies to get an ICP number/license to ensure that its customers can easily visit its website without having to circumvent the ‘Great Firewall of China’.

When performing due diligence on Chinese stocks, I want to see that its website has an ICP number/license.  Chinese websites will typically display the number at the very bottom of its webpages.  Remember to check the Chinese version of a site as the English version may not show the ICP number.

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China Information Technology (CNIT): A case of multiple personality disorder?

CNIT is a very curious company.  On September 4, 2013 it issued a press release titled “China Information Technology, Inc. Entered Into Exclusive Cooperation Arrangements with Biznest Internet &Software Co.” (see the 6-K filing).  One might be led to believe that Biznest Internet & Software is an independent company.

However, the domain registrations involved with Biznest show email addresses.

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I am disgusted by the BCSC

On December 19, the British Columbia Securities Commission issued a press release titled “Securities regulator alleges fraud against Silvercorp short-seller” that links to a notice of hearing.  In my opinion, the notice of hearing unfairly smears Jon Richard Carnes of Alfred Little.  Secondly, I believe that the claims against him are extremely weak.

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More new positions Dec 20, 2013

Long: LMCA

Short: JKS, CSIQ, SPWR, ZU, PCYO, EBIX (puts and common), AMT puts, TTS, YONG puts, AVID

Closed: KWG*, short NUS.TO, short BBRY, short CREE, short TLT

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Pretium: The bullshit engineering continues

Today, Pretium issued a press release: Pretium Resources Inc.: Mineral Resource Estimate Adds Measured Gold Resources, Increases Grade at Valley of the Kings

Basically, Snowden is pretty much going to stick with its aggressive approach in modeling the VOK deposit.

The press release also contains some information aimed at invalidating Strathcona’s competing theory about how the resource should be modeled.

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Betting on a Potashpocalypse

I’m attracted to cheap options and this is the main reason why I am long Potash Corporation of Saskatchewan (POT) put options.  The LEAP puts are trading with implied volatility in the mid 20s.  Potash pricing could collapse due to (A) a wave of excess capacity coming online and/or (B) the potash cartel breaking down.  While I have no special insight into whether or not this will happen, the expected return on this trade should be positive as long as the chance of a decline is high enough.

(This is not a high conviction trade for me.)

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