A month ago, our task was impossible.
Gold and silver prices were rising so fast and so unsustainably, you had to keep one eye on the metals while you looked for gold stocks to own…
Now we have some breathing room. It’s still likely that we could have another leg down on metals prices, but that’s okay. Price softness helps sort out some of the uncertainties in the stocks.
Because if a company is only going to be successful at $5,300 gold, and starts to wither at $5k gold… we don’t want it.
Now is a time to make a list of stocks you want to own.
Four or five of your favorites is plenty.
Here’s what I suggest you look for:
- You want to own at least one high quality royalty firm. These companies are slow moving, but they’re steady climbers. They don’t have the volatility of miners, because they own royalties on dozens of projects. Set a target buy price, and buy them on a weak day. Whatever happens to gold in the coming months, these companies continue to get regular revenues with no overhead.
- You want to own miners along the continuum of the Lassonde Curve. That means you want to look at companies that have a mix of exploration, development and production. Each of these phases comes with its own risks/rewards – as well as catalysts that can boost the stock price.
- World-class developer
- World-class royalty
- World-class ore body
- District-scale potential
- Low jurisdictional risk
The takeaway: your list should include companies that have some significant percentage of their mining projects in the “pre-revenue” stage of mine life.
You can take your time, making this list in the coming weeks and months. Or: you can take a look at my GPIV service, which is dedicated to a handful of my favorite precious metals stocks at any given time.
I try to have a mix which includes at least one royalty and companies that are in advantageous stages of their mine life relative to their mine price.
Right now it includes 3 royalties and 4 miners in different stages of development/production.
Whatever you choose: THIS is the time to start building that list, and buying on weakness.
We get to be choosy now. We have time. But that won’t last. You don’t want to wait until the market starts screaming higher again…
If you wait until the prices jump again, you’ll be standing in line with everyone else. Right now, we’re in the midst of an eerie calm – like the eye of a storm.
Best,
Garrett Goggin, CFA, CMT
Lead Analyst and Founder, Golden Portfolio