Good morning! Radio 4 has given me the first chuckle of the day - a piece about flooding involved Evan Davis interviewing a rather posh lady who explained that introducing beavers upstream can solve flooding problems downstream, as they build dams that slow down, and make the land hold 40 times as much water, thus saving other areas from flooding. Evan Davis replied that presumably if beavers could do it, then so could man? The bemused posh lady retorted "Well yes, but we don't have to pay the beavers any wages. They do it for nothing!" Priceless, in both senses! Anyway, on to serious matters, a couple of blue sky companies report developments;

 

 

 

Clean Air Power (LON:CAP)

Announces a funded development agreement with a global truck manufacturer to develop a dual-fuel engine for the South East Asian market. By "funded" I presume they must mean that the truck manufacturer is bearing all the costs, which is clearly a positive thing. Low emissions seem a key element of this project, which will run for an initial six month concept stage. There are no financial details given, so it's not possible to assess its impact. Although entry into a new market in Asia sounds positive.

The share price here has been weak recently, on no newsflow. So it could just be punters getting bored and selling up to chase other story stocks, which often happens in between newsflow & press share tips with this type of company. Or it could be informed selling by people who know that the company is not progressing well? We just don't know at this stage. This is the trouble with blue sky type companies - it's really just guesswork, and you can't tell whether it's going to work out or not, only time will tell.

On a general level, I've found that the more research people do on blue sky companies, and the more they (supposedly) understand the technology, all it does is make them less inclined to sell the shares once things start going wrong. The bulletin board expert on the company will still be clinging on to forlorn hope (and their shares) long after everyone else has realised that it's going nowhere, or is taking too long. Been there, done that! So I think it pays to…

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