If you take a look at COI’s shareholder profile you will note...

If you take a look at COI’s shareholder profile you will note that approximately 50% is held by the top 20 shareholders with our management holding just under 13% of that figure.

This means that the remaining 50% of the shares are held by those of us who do not fall into the top 20 shareholders.

I suggest that by looking at shareholding trading volumes that there are less than 0.5% of the total shares (673.5 million) being spun over by those trading.

This is the madness of the markets and the way in which market caps are calculated.

A quick ‘off-piste’ example to illustrate my point:

If I have a house that is worth £1,000,000 having been valued at this price by qualified estate agents – my house is indeed worth around this figure.

If I split the ownership of my house between 200 individuals each of whom now owns half a percent – this does not alter the fact that the house is still worth £1,000,000.

The way the markets work is that if one of those 200 owners of the house decides to sell their half percent share of ownership for say £1,500 because they could do with the cash rather than the £5,000 that their share is actually worth – this immediately triggers a downgraded valuation by those that list the house and publish the valuation figures – with them making the assumption that because one of the 200 owners offloaded their half percent share for £1,500 that automatically means that each of the remaining 199 half percent shares are worth exactly the same.

So a house that is actually worth £1,000,000 suddenly is being quoted by the markets as being worth just £300,000.

The basis of published valuations (Market Cap) is purely based on the last buy/sell figure.

Nowhere else in this crazy world in which we live does such a ludicrous way to work out a valuation exist.

That’s exactly the reason why COI sits at the share price/market cap where it does.

This is why I believe that Listed companies are at a massive disadvantage when it comes to commercial borrowing options - with many of the 'financial juggernauts' making their lending decisions based on ‘what the computer tells them’ rather than having the flexibility and business nous to be able to forensically examine a companies net asset worth.

With a private company it’s different in that there is not the mechanism to facilitate the wholesale trading of shares – therefore the commercial lenders have to get off their posteriors and delve deep into what a company is actually worth so they can make informed calculated lending decisions.

Welcome to 2018 - who said technology solves all problems - certainly not a dinosaur like me.

Slightly ‘tongue in cheek' but hopefully a post to illustrate a point.