The Time Has come again to own a few very special situation resource stocks
that I believe will sky rocket in value over the next 12 - 24 months.
I have not owned any junior exploration companies since 2011 when the top
was formed in the sector, and in fact I shorted miners early this year for
some decent gains.
But I believe now is time to add a few small positions to my portfolio which
should provide big rewards during a time when the overall equities market and
financial system are about to struggle.
From being involved in the precious metal market since 2001 I have seen numerous
exploration companies succeed and even more fail. But what is important to
understand is that each of these winning companies had the same core things
working for them.
Characteristics among Successful Exploration Companies:
- Properties located in a proven resource rich zone
- Properties explored and have proven value in the ground
- Low cost operation and logistics for transportation ore and supplies
- Management team which proven track record of success
- Market timing - completes exploration for being acquired or starts producing
just before a resource bull market.
These core characteristics are what allow companies to emerge as buyout targets
and get acquired or become low cost producers. Both of these outcomes can generate
a substantial increase in share value.
While junior producers can generate more share value growth than that of a
company being acquired, they typically take more time to mature and become
known.
But, junior exploration companies who have fully explored their properties
and know the value being stored in the ground through the use of drilling and
a PEA, provide a much different type of potential reward to its shareholders.
When these tiny, unknown hidden gems are acquired, investors tend to see the
share price gap higher to the purchaser's value and stay there, to generate
gains of 6x or more return on investment in many cases.
Recently I shared my junior oil exploration stock I own with my followers.
It is becoming a producer as we speak and the next couple weeks are going to
be exciting. Its share price has surged from 6 cents to 24 cents and the crazy
part is no one knows about it yet.
Also a few weeks ago I shared two junior gold and silver exploration companies
which will become producers. One should start producing within a couple weeks,
another is still a few months out, but when they do I expect share value to
rise substantially.
In a couple days I will share with you another stock I personally own. This
is a silver stock and provides a different type of investment opportunity than
normal. This type of play should be in your portfolio for the coming resource
bull market I expect to start later this year.
