Shares in the S&P/ASX 200 Index (ASX: XJO) lithium stock and diversified resources producer closed Friday trading for $65.91. In early trade on Monday, shares are swapping hands for $66.42 apiece, up 0.8%.

For some context, the ASX 200 is down 0.3% at this same time.

This comes following the announcement of a proposed lithium acquisition.

Here's what we know.

ASX 200 miner to acquire Lake Johnston

The Mineral Resources share price is moving higher after the company reported it has entered into a binding heads of agreement to acquire the Lake Johnston nickel concentrator plant and tenure from Poseidon Nickel Ltd (ASX: POS).

The Poseidon Nickel share price is tumbling on the news, now 12%.

Mineral Resources plans to develop Lake Johnston as a lithium processing hub in the southern Goldfields region of Western Australia.

The company noted that the nickel concentrator plant has a flotation circuit with a front-end capacity of 1.5 million tonnes per annum. And it can be converted to treat lithium ores, including dense media separation fines.

The ASX 200 miner will pay Poseidon Nickel $1 million on execution of the agreement, $6.5 million on completion of the sale and purchase, and $7.5 million 12 months after completion.

Commenting on the proposed acquisition that looks to be helping boost the Mineral Resources share price today, managing director Chris Ellison said:

This is an exciting opportunity to develop MinRes' third lithium processing hub in the Goldfields and the first to include flotation capacity to treat fines.

We intend to bring our expertise in spodumene production to Lake Johnston, which has the potential to service projects throughout the world's most prospective region for lithium.

Poseidon Nickel CEO Craig Jones said that atop the $15 million in cash, the junior miner will retain "an exposure to any exploration success at Lake Johnston with royalties from any future minerals or metals production from the project tenements".

Under the proposed agreement, Poseidon will receive 0.75% FOB royalty on lithium minerals and 1.5% net smelter return royalty on all other minerals and metals extracted from the Lake Johnston tenements.

Lake Johnston is licensed to operate until 2041.

Mineral Resources share price snapshot

Despite its diversified mining assets, the Mineral Resources share price has not escaped the pain of plunging lithium prices.

Over the past 12 months, shares in the ASX 200 miner are down 14%. Shares are up 26% since the recent 22 January lows.

The post Mineral Resources share price marching higher on new lithium project acquisition appeared first on The Motley Fool Australia.

The Motley Fool chats with the best in the industry so that you can get an insight into how the professionals think. In this edition, Red Leaf Securities chief executive John Athanasiou gives his thoughts on the ASX shares that are savagely discounted at the moment.

Cut or keep?

The Motley Fool: Let's examine three ASX shares that have been devastated this year, and see if you think each of these is now a bargain buy or a value trap.

The first one is Megaport Ltd (ASX: MP1), which has plunged almost 60% over the past year.

John Athanasiou: It's down quite significantly and it's one of the most shorted stocks on the ASX, Megaport. They've got a short interest of roughly 9%. 

This network provider, they appear to be targeted by these shorters because they've got operating issues, it seems. So I would call it for now a value trap, even though I do like the tech sector. There's no rush into it right now.

MF: Fair enough. Maybe you'd consider it if it got even cheaper?

JA: I would definitely consider it if it gets cheaper. Absolutely, yeah.

MF: The next one is Poseidon Nickel Ltd (ASX: POS). It's also down about 60% over the past 12 months. Your thoughts?

JA: In relation to Poseidon Nickel, even though I do like my small to micro-cap stocks, I would be a little bit cautious and wait for their Black Swan project to restart before getting involved in that one. 

I am bullish on nickel prices, but at this stage, nickel prices have fallen a fair bit. They're beginning to recover. But I think it'd be a more cautious approach and wait until that Black Swan project restarts.

MF: There's probably other producers that are already in production mode, aren't there?

JA: Exactly. So there's other opportunities out there. And if you want exposure to the resource, then you can go to the majors as well.

MF: The third one is Dusk Group Ltd (ASX: DSK), which is a retailer down about 39% over the past year. What do you reckon?

JA: Discretionary retailers had a real rough time and Dusk is no different. 

The RBA rate [rises] are really starting to bite on consumer spending. I just don't see consumers rushing out to buy candles no matter how good they smell right now. 

They did mention their online sales are decreasing and the CEO, Peter King, is trying to offset this by opening six new stores. Now obviously you'd imagine that'll impact margins, opening new stores and the cost associated with bricks-and-mortar. 

Even though we're bullish on the market, we're avoiding discretionary spending because it's only now we're seeing the real world impact of cash rates rising. 

There will be a time to buy Dusk, but I don't think it's right now. Maybe towards the end of the year or early next year, you'll be looking at discretionary retail stocks.

The ASX share for a comfortable night's sleep

MF: If the market closed tomorrow for four years, which stock would you want to hold?

JA: Well, four years is a long time not to have any information. So in light of that, I'd have to go conservative. I'm looking at Commonwealth Bank of Australia (ASX: CBA). 

They pay you a decent dividend, 4%. They essentially grow with the Australian economy and they're going to be around in four years.

The post 3 ASX shares to avoid like the plague (and one to buy for the next 4 years): expert appeared first on The Motley Fool Australia.

While most people are aware of the crucial role of lithium in lithium-ion batteries, nickel is also a critical battery element. In fact, a single Tesla battery requires some 50 kilograms of nickel.

Certainly, no unwelcome news for nickel stocks.

The bulk of nickel is currently used in the manufacture of stainless steel, with some 15% going to the EV market. But that share is likely to grow.

China, the world's most populous nation and number two economy reported record high EV sales of 571,000 vehicles for the month of June.

And Hayden Bairstow, resources division director at Macquarie, expects the percentage of nickel demanded by the EV industry to "move into the 20s and 30% of the total, and beyond that over time, as the EV market gets larger and larger".

That's a healthy longer-term outlook for demand.

Now, how have some of the leading ASX nickel stocks been tracking this year?

ASX nickel stocks mixed performance for 2022

There's a wild divergence between the share price moves among the ASX nickel stocks year-to-date.

Digging into the specific factors that have lifted or lowered the individual company share prices is beyond the scope of this article. And bear in mind that most of these miners are not solely focused on nickel, though the metal does form a key part of their exploration and production goals.

With that said, here's how these ASX nickel stocks have fared so far in 2022:

• Poseidon Nickel Ltd (ASX: POS) share price is down 48%
• Mincor Resources NL (ASX: MCR) share price is up 17%
• Nickel Industries Ltd (ASX: NIC) share price is down 23%
• OZ Minerals Limited (ASX: OZL) share price is down 11%

Moving on to a few other big-name ASX stocks looking to increase their nickel exposure, we have IGO Ltd (ASX: IGO). IGO completed its acquisition of nickel miner Western Areas in June. IGO shares have gained 1% this year.

Then there's BHP Group Ltd (ASX: BHP), the biggest stock on the ASX and among the world's biggest miners.

BHP's unsolicited proposal to acquire all shares in Oz Minerals for $25 per share in cash was rejected by the ASX nickel stock.

Addressing BHP's proposal and the subsequent rejection, Oz Minerals CEO, Andrew Cole said, "We have a unique set of copper and nickel assets, all with strong long-term growth potential in quality locations."

The BHP share price is down 3% in 2022.

The post How have ASX nickel stocks been performing in 2022? appeared first on The Motley Fool Australia.

This comes as nickel prices are rebounding and global EV production is booming. China reported an all-time high of 571,000 EV sales in June, helping drive increased demand for the metal.

Like lithium, nickel is a core element in EV and grid storage batteries. Most of the global nickel production goes into making stainless steel. But some 15% is now used in the EV market. And that share is likely to grow, with a single Tesla battery requiring some 50 kilograms of nickel.

According to Hayden Bairstow, resources division director at Macquarie (courtesy of ABC News):

But certainly over time, expectations are that [electric vehicles] will become a much larger piece of the demand pie for nickel. It is about 15% now of the global nickel demand market, if you like, for electric vehicles.

That's certainly grown from basically nothing a few years ago, and the expectations are that it will move into the 20s and 30% of the total, and beyond that over time, as the EV market gets larger and larger.

That strong demand growth should offer some welcome tailwinds for ASX shares with nickel exposure.

Which ASX shares have exposure?

There are a number of ASX shares with a strong focus on nickel exploration and production.

Some leading names include Poseidon Nickel Ltd (ASX: POS), Mincor Resources NL (ASX: MCR), and Nickel Industries Ltd (ASX: NIC).

Some of the biggest ASX mining shares have also been actively seeking to increase their nickel holdings, partly driven by forecasts of continued growth in EV battery demand.

In June IGO Ltd (ASX: IGO) completed its acquisition of nickel miner Western Areas.

At the time, IGO's CEO, Peter Bradford said the move was "a logical consolidation of key nickel assets in Western Australia". Bradford added that the acquisition improved the company's position "as a leading, independent producer of metals critical for a clean energy future".

BHP nickel expansion thwarted… for now

The largest ASX share of them all and one of the world's biggest miners, BHP Group Ltd (ASX: BHP), made headline news earlier this month for its unsolicited, conditional and non-binding indicative proposal to acquire all shares in nickel and copper focused OZ Minerals Limited (ASX: OZL).

The takeover offer of $25 per share in cash was unanimously rejected by Oz Minerals' board. Commenting on that decision, CEO Andrew Cole said, "We have a unique set of copper and nickel assets, all with strong long-term growth potential in quality locations."

The post Why is nickel such a big deal and which ASX shares have exposure? appeared first on The Motley Fool Australia.

The company's share price has fallen 24% from 8.9 cents at market open on 19 April to its current share price of 6.75 cents. In today's trade, the Poseidon Nickel share price is rallying 3.5%.

Let's take a look at what is happening at Poseidon Nickel.

Why is the Poseidon Nickel share price falling?

Nickel prices could be impacting the company's share price. Nickel prices have plunged 20% in a month, Trading Economics data shows.

Poseidon is exploring the Windarra, Black Swan, and Lake Johnson nickel projects in Western Australia.

The company reported its quarterly results on 29 April. On that day, the company's share price climbed 1.2% from 8.3 to 8.4 cents. The company reported cash of $16.8 million as of 31 March 2022. Commenting on the results, managing director and CEO Peter Harold said:

The company continues to make solid progress on our 'Fill the Mill' strategy. The Black Swan Disseminated resource drilling program, Silver Swan decline rehabilitation and pit dewatering studies were important milestones achieved in the March quarter.

Earlier, on 27 April, Poseidon provided a resource update from the Silver Swan deposit at Black Swan. The company reported an increase in high-grade resource base at the project.

For context, the S&P/ASX 200 Materials Index (ASX: XMJ) has fallen more than 12% in the past month.

Share price snapshot

The Poseidon Nickel share price has climbed more than 6% in the past year but it has shed 38% in the year to date.

For perspective, the benchmark S&P/ASX 200 Index (ASX: XJO) has returned 1% in the past year.

Poseidon Nickel has a a market capitalisation of about $208 million based on today's share price.

The post The Poseidon Nickel share price has dumped 24% in a month. What's happening? appeared first on The Motley Fool Australia.

In morning trade, the nickel developer's shares jumped almost 13% to 98 cents.

The Poseidon Nickel share price has since pulled back a touch but remains up 9% to 9.5 cents at the time of writing.

Why is the Poseidon Nickel share price shooting higher?

Investors have been bidding the Poseidon Nickel share price higher today after the company became the latest (indirect) recipient of a Modern Manufacturing Initiatives (MMI) Grant from the Australian Federal Government.

According to the release, Pure Battery Technologies (PBT), in partnership with Poseidon Nickel, has been granted a $119.6 million MMI grant to advance a proposed battery material refinery hub in Kalgoorlie, Western Australia.

The release explains that the battery material refinery hub is targeting initial production of up to 50,000tpa of precursor Cathode Active Material (pCAM), with potential for further production expansion in time.

"Wonderful news"

Poseidon Nickel's Managing Director and CEO, Peter Harold, was very pleased with the news.

He commented: "This grant is wonderful news for Poseidon and PBT and a major vote of confidence by the Federal Government supporting PBT's plans for the Kalgoorlie pCAM Hub. This project will add significant value to the battery minerals it processes, and Poseidon is well placed to be a major beneficiary given it has the potential to be a significant supplier of feed to PBT's proposed PCAM Hub from our existing 400,000 tonne nickel resource base and nickel concentrators at Black Swan and Lake Johnston."

"Given the nature of the processing route, being direct to pCAM, and the proximal location of the proposed pCAM Hub to our mines, there is an opportunity to enhance the margins on our concentrates," he added.

What now?

At present, PBT and Poseidon Nickel only have a memorandum of understanding (MoU) in place. This means that the two parties will now need to execute a definitive supply agreement to take things forward.

The company explained: "The MoU noted that obligations of the parties were not binding or enforceable unless and until a Definitive Agreement has been entered into. The receipt of the grant is a major milestone for the pCAM Hub project and will be a key driver for the parties to formalise their collaboration through the proposed Definitive Agreement."

The post Poseidon Nickel (ASX:POS) share price surges 13% higher on 'wonderful news' appeared first on The Motley Fool Australia.

This comes as the company requested that its shares be placed in a trading halt.

At such, the nickel producer's share price is frozen at 8.7 cents.

Why is the Poseidon Nickel share price halted?

Prior to the market opening, the company requested the Poseidon Nickel share price be halted while it prepares an announcement.

In its release, the company advised it planned to make an announcement regarding a "significant funding development" with the Pure Battery Technologies Kalgoorlie battery metals refinery.

Poseidon Nickel has asked that the trading halt remain in place until Friday 18 March or following the release of the announcement, whichever comes first.

More on Pure Battery Technologies

Pure Battery Technologies announced plans in October last year to build a $460 million battery material refinery in Western Australia.

The hub will process nickel, manganese and cobalt to initially produce 50,000tpa of precursor cathode active material (pCAM) per year. This will be enough to create up to one million lithium-ion EV batteries in an effort to meet global demand.

Pure Battery Technologies managing director and CEO Bjorn Zikarsky said previously:

The Kalgoorlie pCAM hub is ground-breaking in terms of the green technology it will use and its role in the future of domestic and overseas EV markets.

Both Pure Battery Technologies and development partner Poseidon Nickel have been working together to get the project off the ground.

Poseidon Nickel managing director and CEO Peter Harold commented earlier this month:

We are currently advancing the bankable feasibility study for Black Swan, which includes evaluating a number of offtake options to deliver long term value for the project. These options include traditional nickel smelters, existing leaching plants and proposed plants (ie. PBT's Kalgoorlie pCAM hub).

About the Poseidon Nickel share price

From March 2021 to July 2021, Poseidon Nickel shares surged from 5.5 cents to an all-time high of 16 cents.

However, this was short-lived with the company's share price tumbling 60% to around 10 cents in August 2021.

Since then, Poseidon Nickel shares have moved in circles despite the spot price of nickel rocketing 200% in a year.

Based on valuation grounds, the company has a market capitalisation of roughly $266.56 million, with approximately 3.06 billion shares outstanding.

The post Here's why the Poseidon Nickel (ASX:POS) share price is on ice today appeared first on The Motley Fool Australia.

There hasn't been this kind of calamity on commodities exchanges since previous crises for tin, oil and gold back in the 70s and 80s.

The London Metal Exchange (LME) promptly halted trading after prices went parabolic, as brokers struggled to fill orders and collect margin calls from traders being liquidated en masse. Billions were lost from short sellers as the price eventually spiked 250% in around 24 hours.

Afterwards, trading of the metal could only occur within European hours and with a 10% cap on volatility.

Obviously, the conflict in Europe has the market jittery over supply concerns on the industrial metal, that is used in applications ranging from batteries to steel production.

Nickel had already been strong for more than 12 months prior to the conflict. However, Russia is the world's largest supplier of nickel and the events sparked a frenzy on the LME last week.

At the time of writing, Nickel is fetching US$48,226 as things have 'settled' and trading has somewhat returned to normal.

But there's a bit more at play than just the forces of supply and demand in this case. Firstly, it appears to be more market mechanics instead. And second, there wasn't that much of a spread between buyers and sellers in early March anyway.

There was, however, a large amount of short interest on the price of nickel from one particular steel and nickel juggernaut out of China, Xiang Guangda.

Guangda is the owner of Chinese steel and nickel giant Tsingshan Holding Group Co. The company is actually a large buyer of the metal, being the world's largest steel producer, but held a large short position in nickel futures as well.

It's not entirely clear if this was as a hedge against falling nickel prices or if there was some speculation involved, now that some time has passed and more details have emerged on the matter.

Instead, what happened was a classic but rare 'short squeeze' – not unlike that seen in the GameStop Corp. (NYSE: GME) saga in early 2021.

Back then, GameStop shares rose from around US$17 to US$325 per share in less than a month as retail traders squeezed out hedge funds that held large positions on the company.

In other words, we've seen this movie before. But what is a short squeeze? And will it impact ASX shares? Let's take a look.

What is a 'short squeeze'?

Those holding a short position in the futures markets are either protecting against price movements or wagering that prices will fall.

Obviously, those speculators will see their capital evaporate if prices suddenly shoot up, if they aren't hedged themselves.

In a squeeze, rising prices put these speculators in between a rock and a hard place. In order to stay in the trade, they (or their brokers) must buy (or go long) on the asset in a process known as 'covering the short'.

However, if the short interest is high enough, the process forms a negative feedback loop – as prices rise, the huge wager forces the trader to buy more of the asset — pushing prices up even further, and compounding losses on the short side.

The same happened with GameStop stock, albeit in a more architected fashion. This time, however, it was with nickel, a global commodity that is essential to our day-to-day lives.

Not to mention it's requisite in the future of energy production and the likes.

So as prices began to rise, the short seller had to cover his position by buying nickel, sending prices higher. Other speculators joining in may have also helped the rise.

What actually happened?

It was a fairly interesting set of affairs. As the events unfolded on 8 March, many in the industry were talking of an all-out meltdown in nickel markets.

If we backtrack a bit just before the jump, we see that nickel has been in an uptrend with strong support. Despite the gain in price, Tsingshan was able to meet its margin calls at that time, Bloomberg reported.

It wasn't until the enormous surge began on 7 March that LME brokers began to feel nervous and started ringing their clients to post more margin in their accounts. Margin is just a cash balance that futures traders must maintain as they trade on leverage.

Tsingshan got a margin call for $3 billion, according to Bloomberg, meaning it had exposure to more than 150,000 tonnes of nickel.

The problem for Tsingshan was that $3 billion was a little too much for this steel giant's bank account. Plus, no banks were going to answer their calls to lend that amount on credit.

Unfortunately, it's the brokers who first have to pay the margin calls, but to the exchange. They then receive the margin top-up from their clients.

In this case, the banks and brokers were paying, but receiving no margin top-up from their client. These banks had "offset their deals with Tsingshan by placing their own short positions on the LME", according to Bloomberg reports.

"Now they had to pay big margin calls on the exchange while receiving no margin from their client," Bloomberg said.

Some of these banks started to rapidly buy back nickel contracts in order to cover themselves, and this sent prices soaring even higher.

"It was a classic short squeeze, as the pain for Tsingshan, its brokers, and other shorts created a self-reinforcing cycle," Bloomberg said.

The LME promptly intervened and froze the price of nickel at US$80,000 per tonne, afterwards cancelling all trades that took place on the Tuesday morning – almost $4 billion, according to Bloomberg.

What's happened to ASX shares since?

The fallout has been that the price of nickel is now at unprecedented highs and those nickel producers, such as ASX shares Nickel Mines Ltd (ASX: NIC), Poseidon Nickel Ltd (ASX: POS) and BHP Group Ltd (ASX: BHP), each incurred losses in the days following.

With Nickel Mines, it was due to the association with Tsingshan, such that the company released a statement after its shares were placed in a trading halt. The trading halt came after the Nickel Mines share price had slumped 22%.

Aside from that, the S&P/ASX 300 Metals & Mining Index (ASX: XMM) also took a sharp downturn on the same day and has fallen more than 9% since – even as many commodities surge to decade-long highs.

Much of the reason why ASX commodity shares – particularly those involved with nickel – haven't received the news well boils down to how these markets operate.

One might presume higher prices is a huge positive for miners and producers, for instance.

However, that's not necessarily the case. Miners, manufacturers, producers and the like each use futures markets to place short trades, in order to hedge their exposure to the commodity.

Nickel miners, for example, want to ensure that, when it comes time to sell their product, they can get the best price. If prices fall, they are out of pocket.

That's why they short futures to effectively 'lock-in' the price they can sell at if this were to occur — an insurance of sorts. Buyers of nickel will do the opposite except to lock in a buying price.

Both sides will even 'carry' the trade forward, so to keep the hedging position active as time rolls on.

But when the market makes huge moves in the opposite direction – as it did on March 8 – they will be hit with margin calls or requests to put down more cash to keep the trades open.

No one is immune. It's not just the traders and speculators. It's the largest commodity players each having to scramble to cover their bases.

With this most recent saga, ASX nickel producers who participate in these markets are going to see some impact from the calamity at the earnings level, seeing as their short positions were more than likely taken out with the price surge.

Plus there's no certainty the gain in price will equate to higher sales figures for the companies involved. Sales have to be realised at these record prices for anything to occur.

In other words, it's not all just about demand and supply with commodities – it boils down to factors of hedging, speculation and market mechanics as well.

Thankfully, zooming out and scoping the wider market, there doesn't appear to have been a large spillover into other pockets of the ASX outside of the mining sector.

The S&P/ASX 200 Index (ASX: XJO) is trading sideways and is actually up 1% for the month, while the S&P/ASX 200 Financials Index (ASX: XFJ) has soared around 7.5%.

The post GameStop 2.0? What you need to know about the nickel short squeeze and how it's impacting ASX shares appeared first on The Motley Fool Australia.

ASX investors are showing a muted reaction to the company's half-yearly results to 31 December 2021.

Yesterday's release was labelled non-price sensitive when posted on the ASX late last night. But it's worth a look nevertheless to see what the company got up to during this time.

Poseidon Nickel share price unmoved by half-yearly report

Key points in the report included:

• Incurred a loss of $5.87 million for the period, compared to 2020 loss of $6.02 million
• Net working capital surplus of $17.17 million, compared to $2.44 million at 30 June 2021
• Net cash outflow from operating activities of $5.75 million, up marginally from $5.73 million year on year
• Cash and cash equivalents of $21.94 million at 31 December 2021
• In August 2021, the company raised $22 million (before costs).

What else happened this half for Poseidon Nickel?

During the period, the company announced its 'Fill the Mill' strategy of restarting operations at its Black Swan site.

Specifically, Poseidon says the Fill the Mill strategy is based on feeding the mill with a combination of "low-grade open pit ore, high-grade underground ore and Silver Swan tailings to improve concentrate quality".

Poseidon also says the results of site studies now provide a clearer picture of how to move forward.

"The results of an engineering study undertaken by GR Engineering Limited (GRES) concluded that the costs to refurbish the 1.1Mtpa processing plant would cost approximately $22 million", it said.

Aside from that, the group printed a loss of $5.87 million compared to a loss of $6.02 million the year prior. This flowed through to net working capital of $17 million, boosted by a capital raise in August.

Poseidon says the working capital surplus includes "a provision for environmental rehabilitation of $3,500,000 that is cash-backed (non-current asset)".

During the half, the Poseidon Nickel share price increased by 22%.

Management commentary

Speaking on the company's results, Poseidon Nickel's CEO, Peter Harold said:

The nickel price continued to remain strong during the period, peaking at just under US$9.60/lb in late November 2021 and post period end continuing its upward movement.

During first half FY2022 the Company adopted its new "Fill the Mill" strategy which focuses on restarting the Black Swan operations with high and low grade ore feed sources.

Progressing this strategy the Company released the Golden Swan Maiden Resource and the Silver Swan Tailings Maiden Resource during the period, and continued drilling Tundra Mute within the Silver Swan Channel and the Black Swan disseminated mineralised system.

Poseidon Nickel share price snapshot

In the last 12 months, the Poseidon Nickel share price has soared around 40% into the green. However, this year to date it is down 19%.

The post What's up with the Poseidon Nickel (ASX:POS) share price on Friday? appeared first on The Motley Fool Australia.

Having a variety of different ASX shares spreads out risk and helps you sleep at night, experts say.

However, it might surprise you to know those same professional investors don't necessarily practise diversification themselves.

In fact, many will use their in-depth knowledge to put all their eggs in one or two ASX shares that they're absolutely certain of winning on. 

Call it conviction, call it guts, call it what you will. 

But the writer has spoken to many fund managers who do this for their personal portfolios, which is completely the opposite of what they advise clients on how they run their fund.

Very few are willing to reveal this publicly though, for fear of burning vulnerable retail investors.

Turning $156,000 into $12 million

One expert who is quite happy to go on the record is Marcus Today founder Marcus Padley.

Padley has claimed more than once that diversification is a false idol.

"In the remote wilderness of portfolio construction, we have a lot of gurus — but there is one religion: it's called diversification," he said in a podcast last year.

"It underperforms in the good times, outperforms in the bad times, but it still doesn't perform anyway."

The Motley Fool reported last year that one of Padley's followers had turned $156,000 into $12 million in just 3 years by putting it all in one ASX share.

Many might think this is risky, but Padley reckons it's the opposite.

"It's actually less risky because you've got your head in the game and you've only got one stock to focus on after all," he said.

"If you were to buy one stock, you're going to watch every move. You'll go to every company presentation, get to know the CEO, get to know the other shareholders… You're going to watch the drivers and pick up on anything that's relevant to that stock."

Practising what he preaches

To put his money where his mouth is, in a recent podcast Padley revealed that he himself only owns 2 ASX shares.

One of them is Poseidon Nickel Ltd (ASX: POS), which he has held for "a long time".

"The CEO is godfather to one of my daughters, hence the faith in the man, who I know really well."

That chief executive, Peter J Harold, has a track record of turning exploration businesses into producers, and Padley believes Poseidon would follow.

"Poseidon is sitting on a couple of projects that used to produce. It's just a question of the nickel price rising high enough to make those viable," he said.

"They expect to be back in production by December this year."

The Poseidon share price has sunk more than 23% this year.

The second and final stock in Padley's personal portfolio is Environmental Group Ltd (ASX: EGL).

Padley became interested in this environmental services provider when a trio of former Tox Free executives joined the firm.

"There is more cleanup to be done in Australia that EGL could possibly handle," he said.

"This is just a question of getting around the technology. It's not a question of finding things to do."

Capital H Management founder and chief executive Harley Grosser told The Motley Fool earlier this month that he's also a fan of EGL.

"The management team is A grade," he said.

"They've done it before at Tox Free — a lot of the institutional fund managers know of [chief executive] Jason [Dixon] and his team, and the stock looks good value to us. So we'd expect it to do well this year."

The EGL share price is down almost 18% for the year so far.

The post I personally only own 2 ASX shares: fund manager appeared first on The Motley Fool Australia.

It follows yesterday's news detailing positive assay results from the project's Silver Swan Channel. Those results spurred the company's stock to surge 8.7% to close at 10 cents on Monday.

Today, the Poseidon Nickel share price has been wobbling. It reached as high as 10.5 cents and as low as 9.9 cents during intraday trade.

Right now, it's flat with its previous close.

Let's take a look at today's news from the nickel explorer and developer.

Poseidon Nickel share price wobbles on Black Swan update

The Poseidon Nickel share price is on the move on Tuesday after the company's managing director and CEO, Peter Harold noted that drilling programs at the Black Swan Project continue to show positive results.

Harold stated that the results show the potential for an increase in the mining inventory for the restart.

So far, drilling has flagged the potential for more consistent metallurgically favourable serpentinite mineralisation in a disseminated zone below the existing pit.

Additionally, knowledge of the project's resources helps to build an understanding of its mineralogy and metallurgy, thereby allowing the company to refine its ore blending strategy.

The 'Feed the Mill' strategy employed by Poseidon Nickel to restart the project is also continuing nicely.

The strategy is based on feeding the 1.1 million tonnes per annum processing circuit from a combination of feed sources to maximise nickel units produced.

The company has now approved studies on dewatering the Black Swan open pit – set to begin in 2022. It has also given the okay to work on getting environmental and mine approvals.

On top of that, it's started looking into hiring project management leaders, getting approvals for site-based accommodation, and grid power allocation.

After the company finishes the current drilling programs at the project's Silver Swan Channel and BSD, and receives assay results, updated mine studies, and indicative offtake terms, a further internal Preliminary Economic Assessment will be completed.

Poseidon Nickel expects to make a final investment decision on the project's restart in July 2022. After that, commissioning is scheduled for the first quarter of 2023. That will lead to the Bankable Feasibility Study, due in June 2022.

No doubt, many eyes will be on the Poseidon Nickel share price then. Right now, the company's stock is 42% higher than it was at the start of 2021.

The post Why is the Poseidon Nickel (ASX:POS) share price hitting stormy seas today? appeared first on The Motley Fool Australia.

At the time of writing, the nickel miner's shares are swapping hands for 9.9 cents a pop, up 8.79%.

What did Poseidon announce?

In today's statement, Poseidon advised that its latest infill drilling assay results have identified high-grade intersections at the Silver Swan project.

The company's infill drilling program completed 23 holes, logging well-developed massive nickel sulphides deposits within the Tundra Mute Resource. The recent holes drilled came back with the following results:

• 12.9 metres at 10.63% of nickel (Ni) from a depth of 241.1 metres (PTMD005)
• 6 metres at 11.36% Ni from a depth of 257 metres (PTMD007)
• 11 metres at 13.26% Ni from a depth of 288 metres (PTMD014)
• 3.5 metres at 16.30% Ni from a depth of 287.9 metres (PTMD015)
• 15 metres at 17.92% Ni from a depth of 265 metres (PTMD018)

Poseidon noted that a downhole electromagnetic survey discovered seven plates that are considered highly conductive. These readings often suggest the presence of massive sulphides which are located within the area of known existing mineralisation intersections.

While the results are positive, the company will conduct further electromagnetic surveys in the near future. The information will guide additional drill testing in the area.

Poseidon Nickel managing director and CEO, Peter Harold commented:

We are delighted that the recent Silver Swan drilling has returned a series of high-grade results which will most certainly add tonnes to the resource base at Tundra- Mute.

While these results are very significant on their own, the fact that the down hole EM survey has returned strong EM conductors is a good indication that there is additional high-grade mineralisation in the vicinity of the existing know mineralisation.

These are fantastic results and demonstrate the perspectivity of the Silver Swan Channel.

About the Poseidon share price

Over the past 12 months, Poseidon shares have rallied almost 40% higher, reflecting positive investor sentiment. Since the start of 2021, the company's share price is up around 50% alone.

On valuation grounds, Poseidon presides a market capitalisation of roughly $300.27 million, with more than 3.06 billion shares outstanding.

The post Here's why the Poseidon Nickel (ASX:POS) share price is climbing 8% today appeared first on The Motley Fool Australia.

Well, today, we've found out what all the fuss is about. And, boy, have Poseidon Nickel shares returned with a vengeance. Poseidon is currently up by a healthy 11.7% at 10.5 cents a share. This came after Poseidon rose as high as 12 cents a share upon its return to the markets this morning. That was a bump of roughly 17%.

Poseidon Nickel share price roars back to the markets

Poseidon released an ASX announcement this morning which has some potentially big implications for the company. The good news? Poseidon Nickel has uncovered a "exceptional intersection of massive sulphides at Silver Swan".

Yes, in an update for its Silver Swan drilling project, Poseidon has announced that the company has found a significant mineralised section at its Tundra-Mute zone at the Silver Swan project.

The company intersected "13.6m [metres] of massive Ni-Cu [Nickel Copper] sulphides visually logged". Its true width is estimated at 9.8 metres.

Here's some of what Poseidon managing director and CEO Peter Harold had to say on this news:

We are very pleased to have recorded a very wide intersection of 13.6 metres of massive sulphides within the Tundra Mute Resource in the Silver Swan channel. This is the best intersection so far in this drill program and is significant given that the average thickness of the Tundra Mute Inferred Resource was previously about 2 metres.

The aim of this program is to increase the confidence in the resource by converting existing resources from Inferred to Indicated and to potentially find high-grade mineralisation outside the current known resources.

While today's share price gains would be welcomed by investors, it still doesn't put Poseidon anywhere near the 52-week high of 16 cents a share we saw back in late July. Even so, Poseidon remains up a pleasing 57% in 2021 so far.

At this latest Poseidon Nickel share price, this company has a market capitalisation of approximately $314 million.

The post Poseidon Nickel (ASX:POS) share price booms 17% on 'exceptional' drilling results appeared first on The Motley Fool Australia.

Poseidon shares have been moving since a company announcement advising of updates at its Black Swan project and "Fill the Mill" strategy.

The company outlined progress at the site plus the favoured outcomes from a July 2021 scoping study undertaken for the project.

From the results, Poseidon reckons that growing its high and low grade indicated resource base at Black Swan will have the best economic outcome for the project moving forwards.

As such, its Fill the Mill strategy is "focused on growing [its] mine inventory at Black Swan with an aim to supporting a project life of more than five years".

Here are the details.

What did Poseidon Nickel announce?

Poseidon also detailed a number of other progress updates for its Black Swan site.

The nickel miner advised that new high-grade discoveries at its Golden Swan prospect now add another 6,300 tonnes of contained nickel to its Black Swan resources.

In addition, drilling at its Silver Swan site is now underway with the aim of increasing "high-grade mining inventory". Previous test work "confirms Silver Swan tailings improves the Fe:MgO ratio of concentrate" at this location.

With regards to its Fill the Mill strategy, outcomes from the July 2021 scoping study indicated Poseidon has two attractive production options for mining at Black Swan.

To maximise the production of total nickel tonnes at the site, Poseidon reckons growing the high and low grade indicated resource base at Black Swan is the most attractive option economically.

This includes the resource at Golden Swan, Silver Swan, Silver Swan tailings, and Black Swan disseminated open pit ore feeds, according to the announcement.

It also came up with "relatively low capital and operating expenditure estimates for the larger 1.1Mt plan" and notes recent improvements in the payability of nickel in concentrates due to a "tightening market".

And with the spot price of nickel fetching near recent 5-year highs at US$20,134/tonne, Poseidon believes the outlook remains positive for the future.

The company also identified the possibility to have a long-life project that could also treat ore from its 100% owned Windarra project.

In addition, for its Black Swan site, the company has signed a 5-year water access agreement with Norton Gold Fields Pty Ltd to help "de-risk" the project.

In fact, since 2018, the company has made several advancements in 'de-risking' the project. It says it has done this by growing the mineral resource at Black Swan, looking at ways to remove impurities from the ore and gaining access to grid power to reduce operating costs.

What did management say?

Speaking on the announcement, Poseidon Nickel CEO Peter Harold said:

Since announcing our "Fill the Mill" strategy in July 2021 the Company has made considerable progress on workstreams progressing our Black Swan project towards a restart, targeting late 2022 plant commissioning.

He continued:

Of particular importance, we have released our maiden Golden Swan Resource, commenced resource drilling at Silver Swan to convert Inferred Resources to Indicated and begun drilling of the Black Swan disseminated orebody to increase confidence on the grade and the amount of serpentinite ore in this Resource. We have also released a maiden Resource on the Silver Swan tailings and commenced metallurgical test work on blending the various feed sources through the Black Swan 2.2Mtpa concentrator, derated to 1.1Mtpa.

Poseidon Nickel share price snapshot

It's been a year of green for the Poseidon Nickel share price, having climbed 32% in that time after rallying 45% this year to date.

These returns have both outpaced the benchmark S&P/ASX 200 Index (ASX: XJO)'s performance. It's risen almost 17% in the past 12 months.

The post Why is the Poseidon Nickel (ASX:POS) share price having such a great day? appeared first on The Motley Fool Australia.

At the time of writing, Poseidon shares are swapping hands for 9 cents a pop, up 3.45%.

What did Poseidon announce?

In a statement to the ASX, Poseidon advised it has intersected significant mineralisation at the Silver Swan project in Western Australia.

The company's infill drilling program completed 15 holes, logging massive nickel and copper sulphide deposits within the Tundra Mute Resource. As such, the recent holes drilled came back with the following visual estimates:

• 4.9 metres of massive and stringer sulphides (PTMD005)
• 4.2 metres of massive and stringer Ni (nickel) and Cu (copper) sulphides (PTMD007)
• 10.1 metres of massive and stringer Ni sulphides (PTMD014)
• 6.2 metres of massive and stringer Ni-Cu sulphides (PTMD015)

Poseidon noted that, while promising, it will need to wait for a laboratory analysis from the geological samples. This will determine the grade and widths for each of the drilling holes.

The aim of the drilling works is to convert Poseidon's existing Inferred Resources to Measured and Indicated (M&I) Resources.

The term Inferred Resources refers to quantity, grade (quality), and mineral content that is estimated with a low-level of confidence. On the other hand, M&I Resources is a reasonable to high-level of confidence based on enough samples being collected.

Poseidon managing director and CEO Peter Harold commented:

We are pleased to see some good hits within the Tundra Mute Resource. The aim of this program is to increase the confidence in the resource, by converting existing resources from Inferred to Indicated and to potentially find high-grade mineralisation outside the current resources. These latest holes should assist in increasing the amount of material in the Indicated Resource category.

We are also about to drill a couple of deeper EM holes and look forward to seeing whether the EM surveys detect any EM plates beyond the current extent of the know mineralisation.

Poseidon share price snapshot

It has been a rollercoaster ride for Poseidon shareholders lately. The company's shares reached a multi-year high of 16 cents in late July, before plummeting lower.

When looking at year-to-date, its shares are up 37% despite falling 10% in the past month.

On valuation grounds, Poseidon presides a market capitalisation of roughly $272 million, with over 3 billion shares outstanding.

The post Poseidon (ASX:POS) share price lifts on 'some good hits' appeared first on The Motley Fool Australia.

At the time of writing, shares in the nickel mining company are changing hands at 10 cents each which is around a 5% loss from the open.

That's a significant drop this morning after Poseidon shares started the day in the green before the jitteriness from investors crept in.

Here's what we know from Poseidon's camp today.

Poseidon Nickel share price slumps after exploration update

Poseidon outlined several takeaways regarding exploration and drilling progress at its Black Swan site.

It revealed two underground rigs are testing the "potential down plunge Silver Swan extensions and infilling existing inferred resources" at its Silver Swan resource drilling program.

The existing Silver Swan resources contain a total of "16kt Ni (Nickel) averaging 9.5% Ni spread over three resources".

These are the Tundra-Mute, Peking Duck, and Fledgling-Canard resources that are each covered in detail throughout Poseidon's update.

In addition, after Poseidon's downhole EM program completed an up plunge of its Golden Swan site, it explained there was "no significant anomalism detected".

Yet, it maintains that "prospectivity remains in untested areas of the Southern Terrace".

In respect to the Golden Swan resource, there's a delay in the finalisation of the maiden resource due to "unforeseen circumstances".

Investors can expect results of the maiden resource at this site to be released in the last week of October, according to the company's update.

Lastly, regarding its "Fill the Mill Strategy", work is continuing on its Bankable Feasibility Study on a 1.1Mtpa processing plant.

The 'base feed' for the study is "a combination of Black Swan open pit ore and Silver Swan Tailings" to be complemented with "high grade ore from both Golden Swan and Silver Swan".

Notably, Poseidon needs to first record a resource at its Golden Swan site to include in the base feed for the study.

What did management say?

Regarding the Fill the Mill Strategy, Poseidon Nickel managing director and CEO Peter Harold said:

The Fill the Mill Strategy for the Black Swan restart requires good confidence in our high-grade resources at both Silver Swan and Golden Swan so the mining studies can maximise the mining inventory and generate accurate mining schedules to assist in de-risking the restart.

Also touching on mineralisation finds at the project, Harold added:

New DHEM platforms have been established down plunge of the Silver Swan mineralisation and these are awaiting a geophysical crew to undertake the survey. The results of the survey could provide targets for extensional drilling. In the meantime, we have identified a good zone of mineralisation below the Black Swan open pit from previous RC drilling, undertaken in 2019, which could present an opportunity to increase the size of the pit and extend the proposed open pit mine-life. We can drill this zone from underground and will redeploy one of the underground rigs to undertake that drilling.

Poseidon Nickel share price snapshot

The Poseidon Nickel share price has delivered an outsized return of 54% since January 1, extending its gains in the last 12 months to 19%.

That's roughly in line with the S&P/ASX 200 Index (ASX: XJO)'s return of about 21% in that time.

The post Here's why the Poseidon (ASX:POS) share price is sliding today appeared first on The Motley Fool Australia.

The company has signed a memorandum of understanding with Pure Battery Technologies (PBT). Under the understanding, the companies will test if Poseidon's nickel can be used as a base feed for PBT's proposed precursor Cathode Active Material (pCAM) refining hub.

At the time of writing, the Poseidon share price is 10.5 cents, 5% higher than its previous closing price.

Let's take a closer look at today's news from the nickel exploration and development company.

Poseidon share price charges up on battery-related news

The Poseidon share price is surging after the company announced it could soon supply nickel for battery cathodes.

Poseidon and PBT will be working together to see if Poseidon can supply PBT's proposed Kalgoorlie refinery.

Initially, the companies will be looking into the feasibility of producing up to 50,000 tonnes of pCAM each year.

PBT has commercialised a selective acid leaching process that can produce high-quality, affordable nickel and cobalt materials for lithium-ion batteries. PBT's process also has a lower environmental footprint than other methods.

PBT will be bringing its technology and expertise to the table. Whereas, Poseidon will provide typical specifications and anticipated production volumes from its projects.

The understanding may lead to a definitive agreement. Such an agreement would outline how the companies would fund and develop a supply chain for battery manufacturing markets.

Poseidon's managing director and CEO Peter Harold commented on the news:

We look forward to working with PBT to determine if our potential concentrate production could be feed for PBT's proposed refinery, should we decide to proceed with development of our projects. This could be a great way for us to improve the payability of the nickel in our concentrates and improve the margins of our projects.

The post Here's why the Poseidon (ASX:POS) share price is up 5% on Wednesday appeared first on The Motley Fool Australia.

At the closing bell, Poseidon shares were up 4.35% to 12 cents apiece. In comparison, the All Ordinaries Index (ASX: XAO) finished 0.37% higher to 7,788 points.

What did Poseidon announce?

In a statement to the ASX, Poseidon advised it has completed its SPP, receiving overwhelming support from retail investors.

Originally, the company was targeting to raise $3 million following its successful $22 million private placement. However, after collecting approximately $13.5 million in valid applications, the board of directors increased the offer to $6 million. A scale-back of applications on a pro-rata basis based on amounts applied is being undertaken.

The SPP offered the same terms as the private placement, with its shares priced at 11 cents apiece. This equates to about 54.5 million new ordinary shares under the SPP.

It's expected that the newly created shares will be issued and allotted this Wednesday.

Poseidon's managing director, Peter Harold commented:

The funds raised will support the Company on our strategy to build high-grade nickel inventory at our Black Swan project and progress the Black Swan project toward a potential recommencement of operations in 2022.

The funds raised will be used to continue exploration activities at Golden Swan and across the Southern Terrace, undertake drilling to convert additional Silver Swan mineral resources to ore reserves, further test for extensions to the known Silver Swan mineralisation and complete mining and production studies at Black Swan.

Funds will also be allocated to reviewing the exploration potential of our Lake Johnston and Windarra nickel projects.

About the Poseidon share price

Over the past 12 months, Poseidon shares have rallied almost 100% higher, reflecting positive investor sentiment. Since the start of 2021, the company's share price is up around 80% alone.

On valuation grounds, Poseidon presides a market capitalisation of roughly $346 million, with massive 3 billion shares outstanding.

The post Poseidon (ASX:POS) share price advances on Share Purchase Plan update appeared first on The Motley Fool Australia.

At the time of writing, the Poseidon share price is up 6%, trading at 12.2 cents, after shooting up almost 9% higher for most of the morning trade.

Poseidon Nickel is a nickel miner in Western Australia, with flagship operations including the Lake Johnstone, Mt Windarra and BlackSwan projects.

Let's uncover what the update means for investors.

More results for Golden Swan

In today's release, Poseidon announced that it had achieved more high-grade assays for Golden Swan. The results are from an additional 9 holes of drilling, all within the "mineralised envelope" of the discovery.

Poseidon designed the Golden Swan drilling program to "increase confidence in the continuity" of its Golden Swan mineralisation discovery. It started in April 2021 and has drilled a total of 60 holes for a depth of 15,968 metres.

The company advised that the assays "continue to add to the grade and thickness of the mineralisation". In addition, the return from all 60 drill hole assays was ongoing.

Poseidon expects the initial resource estimate by the end of September, with more assays to be announced as they became available.

What did management say?

Commenting on the update, Poseidon CEO Peter Harold said:

The Golden Swan Resource definition drilling program has been completed and assay results continue to be received. The latest batch of assays has some good widths and grades, including some very high-grade intervals which will bulk up the tonnes in the mineralised zone.

Once all the assay results are received, we will be able to prepare a maiden resource which we plan to release late in the September 2021 quarter.

Harold also advised that the company would launch the Silver Swan reserve upgrade drill program in late August. This program is designed to "increase high-grade nickel inventory" at Poseidon's Black Swan site.

Poseidon Nickel share price snapshot

The Poseidon Nickel share price has climbed 92% into the green over the year to date, extending the previous 12 month's gain of 184%.

Moreover, over the past month alone, Poseidon shares have lifted a further 19% into the money.

These results have outpaced the S&P/ASX 200 Index (ASX: XJO)'s return of around 25% over the past year.

Poseidon has a market capitalisation of $360 million at the time of writing.

The post Why the Poseidon (ASX:POS) share price surged 9% today appeared first on The Motley Fool Australia.

The dip from the market open comes after Poseidon announced an update on its Black Swan operation.

Private placement to drive progress

Poseidon announced it had secured commitments to "place 200 million new shares at 11 cents per share" through a private placement in order to raise $22 million.

The nickel miner said funds would be used for "exploration and drilling" at its Golden Swan interest. It would also conduct"resource drilling" at its Silver Swan site to convert existing mineral to ore reserves.

Moreover, it intends to complete mining studies to "consider the potential recommencement of operations" at its Black Swan site.

As a result of the placement, Poseidon will have approximately $27 million in cash to achieve this.

Speaking on the announcement, Poseidon CEO Peter Harold said:

This over-subscribed placement supports the company on our continued strategy to build high-grade nickel inventory at our Black Swan project and progress the project toward a potential recommencement of operations in 2022.

Investors don't seem satisfied with the news, pushing the company's shares 10% into the red as trading recommences this week.

Poseidon Nickel share price

The Poseidon Nickel share price has posted a year to date return of 88%, extending the previous 12 month's return of 322%.

These returns have outpaced the S&P/ASX 200 Index (ASX: XJO)'s return of around 23% over the past year.

Poseidon Nickel has a market capitalisation of $379 million at the time of writing.

The post The Poseidon Nickel (ASX:POS) share price has sunk 10% today. Here's why appeared first on The Motley Fool Australia.