New Asia Energy Inc (OTCMKTS:NAEI), the events solution company, delivered some investors big profits while others got caught holding the bag. From $0.0884, the share price jumped to touch the level of $0.36 on July 26, 2017. It was astonishing and everybody started talking about the stock. The most interesting part was that the company did not put out any news to justify the price action. Thus, we became much interested in the stock and commenced a more forensic investigation. Have a look at the share price action before we provide our conclusions.SourceBusiness objective and HistoryAccording to the annual report, New Asia Energy, Inc. provides products and services for all types of corporate event. The services were very well explained in the following paragraph:
"Event management is a very important application of project management to the creation and development of large scale events such as festivals, conferences, ceremonies, formal parties, concerts. Event planning includes budgeting, scheduling, acquiring necessary permits, site selection, and arranging for speakers, security, catering services, etc. It is primarily focused on communication with the public, e.g. the potential buyers and the media. By communicating relevant information about the Company including its products and services, event management specialists also help in the promotion of the business. They create a positive public image and establish a relationship with the target audience and media, and earn the consumers’ trust gradually." Source
NAEI was created in the State of Colorado on November 6, 2007. Several changes of control have happened, so the business activity has changed several times. In addition, the name has been changed as well. The following are some of the names under which the company had been traded. We believe that it is good to note them here, as some readers will remember them.
- High Desert Assets, Inc.
- Univest Tech, Inc.
- New Asia Energy, Inc.
The last name change was made on July 23, 2015. On July 29, 2015, the Financial Industry Regulatory Authority approved the corporate actions announced and the company recommenced to trade under the ticker symbol NAEI. Finally, a new change of control happened on December 31, 2015 and the following market participants acquired a large amount of shares.
"Rong Yi Rong (Beijing) Asset Management Limited (167,995,350 shares), Platinum Starlight HK Limited (15,176,877 shares), Beijing Run Zheng Da Technology Development Limited (27,297,224 shares), and Million Leader HK Limited (27,297,224 shares), and Platinum Starlight HK Limited. " Source
As a result of the change of control, the previous directors resigned and the Board was changed from four persons to two persons.The share price increase - What's going on?We had to research the company for some time to understand that the company was not responsible for it. A stock promotion is going on at the moment and the share price increased because of stock promoters. Their activities increased the demand for the stock and the share price reacted to it. This is basic microeconomics theory.Do you need some proof to understand the stock promotion activities? Here you have a photo of the stock promoter website:
We had access to the material distributed by the stock promoter on this website. The stock promoter claimed that NAEI is in a pre-bullish formation. In addition, according to the mail, NAEI moves quite a bit (triple digits to be more precise), and the RSI, the MACD and the Bolinger Bands are at this point in time in a pre-bullish state. We could read at the end of the mail that the company "may be compensated for the production, release and awareness of the newsletter". The skull and crossbones symbol and ConclusionThe OTC Markets Group marked the company with the skull and crossbones symbol:
What does it mean? The exchange is pointing out that the company may be doing one of the following activities:
- Promotion/Spam without Adequate Current Information
- Investigation of Fraud or Other Criminal Activities
- Suspension/Halt
- Undisclosed Corporate Actions
- Unsolicited Quotes
- Other Public Interest Concern
We know a promotion is going on, thus the exchange was right placing the symbol. We don't know about any other irregular activity. To sum up, be careful with the shares of NAEI. We would suggest that the shares are not bought until the skull & crossbones symbol gets removed. Once this happens, we may be able to research the company's activities again.We will be updating our subscribers as soon as we know more. For the latest updates on NAIE, sign up below!Image courtesy of Vincent Nguyen via FlickrDisclosure: We have no position in NAEI and have not been compensated for this article.
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