Back in 2002 the editors of Profit Confidential started telling their readers it was time to jump into gold related investments. If there is one thing we know well, it’s about investing in gold. Our investing in gold advice has proved to be extremely timely. Yes, back in 2002 we started offering gold advice to our readers and we still do it today. We have been recognized as one of the first investment letters to tell its audience to jump into gold stocks, very early in the gold bull market. The investing in gold guidance we provided resulted in many stocks we follow rising in price 100% or more in short periods of time. Today, you can regularly find investing in gold advice in Profit Confidential. Each time gold prices moved higher, we told our readers to buy more gold related investments. See what we have to say about investing in gold dally in Profit Confidential. We have many more Gold Investing Help Articles Now Available.
Investing in gold is a priority if you want to have exposure to the current cycle. As you know, most precious metals have already experienced significant price increases over the last several years. The spot prices of gold and silver continue to hit new highs at this time. For investors in this sector, established junior producers with strong exploration potential offer some of the most compelling opportunities for risk-capital equity speculators. The entire precious metal industry is swimming in cash and there’s going to be a lot of buying and selling of whole companies this year and next.
Interestingly, a lot of commodities have seen their prices move commensurately with stocks over the last while. It’s like the globalized economy (and speculators) are speaking with one voice. I do think both stock prices and most commodities can experience further price appreciation over the very near term, with the likelihood of a correction happening soon. If this happens to both stocks and commodity spot prices, I’d definitely be a new buyer of gold shares.
I prefer the buy-low/try-to-sell-high investment strategy as a general rule. There are always momentum trades in the stock market. There are always special situation opportunities. But in the case of gold and silver, I’m a long-term bull, so I don’t have any problems with investors speculating in shares that have already experienced big price moves. The key to successful gold mining speculation as an equity investor is to buy a “package,” which is a known miner with well-regarded management that’s growing production and earnings, and boasts excellent prospects for further mineral discoveries that can come into production. The investing universe for these kinds of companies is actually quite small.
So far this year, I’ve seen some substantial capital gains among stocks of precious metal producers; not because of strong spot prices, but because of takeover bids. Mergers and acquisitions in this industry are ripe for acceleration and it’s a key component of the risk/return ratio with mining companies. We have many more Bullion Investing Help Articles Now Available.