idea #12 ABERDEEN INTERNATIONAL INC, aab.to

Aberdeen was originally written up on VIC in Aug 2008 at 40 cents per share because it was trading at a discount to NAV ($1 or so).  They are a small investment bank that specializes in junior gold & precious metals mining.  They helped Desert Sun grow from nothing, to eventually be taken over by a large miner.  It was a huge success for them.  The stock collapsed at end of 2008 as one of their largest holders, RAB, liquidated (restructured).   It's nice to buy when you know someone else is selling indiscriminately for non-fundamental reasons.  I am glad I paid attention to that posting on VIC.
 
I found the warrants strangely attractive.  The strike price is around their current NAV ($1) and they don't expire until the middle of 2012.  Like Desert Sun warrants, they provide upside for very little downside, but that downside is permanent loss of capital (rather severe) if you hold too long.  Black Scholes calculations indicate the warrants are way overpriced but BS is notoriously bad for longer dated options.

The company has 30 holdings in the junior resource sector, they hold tons of warrants in those positions.  Most of those positions are penny stocks.  There is all sorts of interdealings with them.  Management is on the board on many of them.  Many have no reserves.  Many of them will fail. 

Positive attributes:
management is incentivized for their success,
they are cheap,
they are controversial,
management has hit some big homeruns in the past (70-bagger). 
they are not pumping the shares, website hasn't been updated in ages

Negatives:
letting the share price collapse during the financial crisis (regardless of who sold) is going to prevent investors from taking a meaningful position.
Not as concentrated a portfolio as I would like to see
Lots of legal issues
Lots of Venture Exchange exposure

This is firmly in the "wait and see" category.  Examining the 30 holdings might lead to some interesting ideas.  Shorting the warrants against the underlying might make a good trade someday.