Daniel Nathel

Gushan Environmental Energy: The Case for Chinese Biofuel

Dan, In response to the breakout... it seemed to be timed exactly in response to a press release that 65 Gushan employees and officers were getting over 1.5 million ADR options to vest a third a year for the next three years at US$10.60. The gain had a fundamental basis, but its magnitude might have been technical.

The fundamental being that they have good management and they are enticing them to stay and conquer the market.

The technical... I know that Market Technicians are capable of producing gains aside from the underlying businesses they are investing in, but I am not one and the word has too many meanings for me. For the sake of simplicity I would replace it with popular or increased demand for ownership in this situation... unless you are referring to something else like one of the volume/financial stat functions that most quote sites offer. If that is the case, I am curious to know what measurement you think was the underlying influence on the gain.

Thanks for your comment though. Shortly after I wrote this article I went long GU, and I nervously watched the price drop more than 10%. "Cat's eye's" comment was quite alarming and made me reluctant to continue writing because it didn't seem like I had a reader. Instead I concentrated on my own analysis more.

I am still in GU now, indefinitely, but I am looking to be compensated more for the risk I assumed when I picked it up. The price has been pretty unstable at the current level and if it had more time to follow it I would probably approach the situation differently and try to take advantage of the huge movements.