Back in April I considered making what I called a three-way high-risk play by investingacross a trio ofpotential multi-baggers.
The growth prospects atMonitise(LSE: MONI),Rare Earth Minerals (LSE: REM)andSirius Minerals(LSE: SXX)were temptingmany investors at the time. I was looking to turbo-charge my rather stodgy-looking portfolio of FTSE 100 blue-chips and wondered whetherthese threecould add some urgency. I thought at least one of them must pay off, makingup for any losses incurred elsewhere.
Off The Moni
Unfortunately, mobile banking software group Monitise has beena full-blown disaster. It was trading at 14p at the time,down fromits 52-week high of 36p. Today, you can hoover upitsravaged shares for 3p a pop. Ithas been a dismal year for Monitise, which has lost a rumoured buyer, founder (joint-chief executive Alistair Lukies), partner (Visa Europe), chief executive (Elizabeth Buse) and the faith of the market.
In return, the company has gained some big-name competitors with infinitesimally larger pockets, including Apple, Google and PayPal. Those who said Monitisewas in a booming sector have been proved right, but it lackedthe muscle to compete. It still notchesup the odd contract win (eg,Telefonica), buturgently needs fresh leadership and profit visibility. One forbottom fishers only.
Mineral Misery
Rare EarthMinerals andSirius Minerals hadto go some to offset my losses. Sadly, REM has fallen 25% since mid-April, from 1.22p to around 90p. Thats despite striking a potentially game-changing deal withelectric sports car and energy storage products company Tesla Motors.
Perhaps investors are nervous about the tough two-year performance milestones Tesla has affixed to the deal tobuy lithium hydroxide from REMsSonora field in Mexico, or maybe it is the lack of recent news, but investor interest has stalled lately. Even news that successful tests had persuaded it tomobilise a second drill rig at Sonora did little to revive spirits. All wecan do now is wait until progress reports on the Tesla lithium deal.
Sirius In The Black
At least Sirius Minerals has hit pay dirt, up28% from 14p to 18p since April, helped by steady progress towards winning full approval forits North York Moors potash project, where it hopes to digthe planetslargest polyhalite mine, which should produce 13m tonnes of the fertiliser per year.
There has been little newssince itreceived prequalification status from Infrastructure UK (IUK) for the project, which will help in its quest to raise funds. Sirius has been knocked by the commodity blow-out, which could make raising investment funds harder. That said, potash is a very different market to, say, copper or iron ore, even if the price has fallen sharply this year.
My three-way bet has gone badly so far, but investing is a long-term game. I dont hold out much hope for Monitise, but Rare Earth Minerals and Sirius Minerals mayyetprove winners. Still, I am relieved Ididnt back this bet with real money.
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Harvey Jones has no position in any shares mentioned. The Motley Fool UK owns shares of Monitise. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.
