Portfolio Update: Reshuffling the Deck (October 20, 2017)

by FI Fighter on October 21, 2017

in Graphite, Graphite Updates, Lithium, Lithium Updates, Precious Metals, Precious Metals Updates

Here’s an update on my latest trades for the week ending on October 20, 2017.

  • Sold 120,000 shares of Black Rock Mining (BKT.AX) @ ~A$0.0825/share
  • Bought 10,500 shares of Dolly Varden Silver (DV.V) @ C$0.6514/share 
  • Bought 10,000 shares of Pure Gold Mining (LRTNF) @ $0.438/share 
  • Bought 5,000 shares of NexGen Energy (NXE) @ $2.12/share 
  • Bought 10,000 shares of eCobalt Solutions (ECSIF) @ $0.84/share 
  • Bought 85,000 shares of Sandspring Resources (SSP.V) @ C$0.35/share 
  • Sold 83,000 shares of Sandspring Resources (SSPXF) @ $0.275/share 
  • Sold 25,000 shares of Hummingbird Resources (HUMRF) @ $0.50/share 
  • Sold 25,000 shares of Hummingbird Resources (HUMRF) @ $0.48/share 
  • Sold 30,000 shares of Birimian Limited (BGS.AX) @ A$0.34/share
  • Bought 1,950 shares of Novo Resources (NSRPF) @ $6.1975/share 
  • Bought 69,400 shares of Artemis Resources (ARV.AX) @ A$0.29/share

Black Rock Mining

Graphite is a tough sector to figure out. My only graphite holding, Black Rock Mining (BKT.AX) announced the appointment of a new chairman earlier this week and the stock popped up over 20% at one point… Since Tanzania has sort of evolved into a more “tricky” jurisdiction for mining in recent months (due to the reform in mining laws), I decided to sell into strength and exit out of this position entirely.

Long-term, I think Black Rock Mining will be a winner and one of the few juniors out there who actually makes it through to production. In the short-term, though, I did worry that this position might be “trapped capital” for me, so I sold out.

I’ll most likely elect to stay out of Tanzania, despite the recent positive news…

From Bloomberg.

It’s too bad because I like Black Rock’s project, but as usual, there’s always another train arriving at the station…

So, it’s all good…

Dolly Varden Silver and Pure Gold Mining

Nothing too surprising here, Dolly Varden Silver (DV.V/DOLLF) and Pure Gold Mining (PGM.V/LRTNF) are two of my favorite juniors in the precious metals sector, so I added shares on the dip.

First, Dolly Varden…

And then Pure Gold…

Gold and silver miners are pretty weak right now, so I didn’t mind topping up some high quality merchandise.

NexGen Energy and eCobalt Solutions

Similar to the two purchases I made up above, I decided to add to my positions in NexGen Energy (NXE) and eCobalt Solutions (ECS.TO/ECSIF).

NexGen just might be on the verge of making another major discovery and the market just doesn’t care right now…

Uranium is hated…

Cobalt on the other hand, is very much in favor, but since the release of the Definitive Feasibility Study (DFS) shares of ECS.TO/ECSIF have been especially weak…

Despite the disappointing results, I thought shares were getting a tad oversold, so I added to my position yet again… I now own 110,000 shares of ECS.TO + ECSIF.

Yes, I am very bullish on cobalt, thanks to the upcoming clean energy/electric vehicle (EV) boom!

It’s too bad sentiment towards uranium is abysmal, though, because NexGen deserves much better than this… If NXE dips below $2.00/share, I’ll have to seriously consider adding even more shares…

Sandspring Resources

OK, so I’ve been busy selling out my position in Sandspring Resources (SSP.V/SSPXF) for a few weeks now…

Finally, this past week, the remainder of my holdings have been liquidated… Good thing too, as the timing coincided quite nicely with the closing of the most recent private placement, which I participated in… I just received my physical shares in the mail this past week from Sandspring… So, although I closed out my previous position in SSPXF, in the end, I ended up adding some more, and now own 85,000 shares

Straight up — I got into the private placement because I wanted to acquire those juicy 5 year warrants with a strike price of C$0.50/share

The recent financing was definitely a raw deal for retail shareholders, so I’m just gonna tell it like it is…

I’m that guy who has no problem ripping apart his own portfolio holdings, and this is just another instance of that!

Obviously, 5 years is a long time (and a lot can happen), so if we get a full fledged bull market in gold, these Sandspring shares + warrants should do exceptionally well… but without that type of upside potential, I wouldn’t be adding to shares of SSP.V/SSPXF right now as a retail shareholder…

No way… there’s just too much dilution/overhang now…

It ain’t a fair fight… but if you’re fortunate enough to play with an “edge”, at least acknowledge/admit it… For sure I’m grateful for the opportunity to participate in the offering, but readers deserve to know how I really feel about the deal (objectively) – It was an awesome deal for “insiders” who got in and a shit deal for retail shareholders (who were unable to participate and have to put up with all the added dilution to the share registry).

Hummingbird Resources

As I acknowledged in a recent podcast, although I still really like the Hummingbird Resources (HUM.L/HUMRF) gold story, it’s up over 100% this year, and a lot of the re-rating that I was after is priced in now…

I’ve been selling off shares of HUMRF in tranches, and now I’ve liquidated out of 3/4 my original position… Over the next few weeks/months, I will look to sell out the remaining position… I made the gains that I was initially after, so I’m good here…

Birimian Limited

I just had to sell some shares of Birimian Limited (BGS.AX/EEYMF) on the most recent bounce up to A$0.34/share… and just like I expected, once I did that, I had a feeling the share price would spike much higher…

Just my luck, as usual… Oh well, no worries… Birimian remains my single largest individual holding, but the last smackdown that occurred after a dismal Pre-Feasibility Study (PFS) was released prompted me to re-think my investment strategy… I realized I was simply too exposed to one stock and it would be in my best interest moving forward to sell SOME and de-risk a bit…

I still really believe in this company/stock/project, but I think I got a little too carried away with this one…

And besides, I needed to raise funds for the following investment ideas…

Novo Resources and Artemis Resources

If you haven’t heard about it, this is what all the buzz is about these days in the gold mining world…

Metal detectors/fossickers.

Conglomerate gold.

Watermelon seeds.

Mt. Roe basalts.

Wits 2.0.

From Novo Resources.

From Artemis Resources.

Enter Novo Resources (NVO.V/NSRPF) and Artemis Resources (ARV.AX/ARTTF) who have a 50/50 joint-venture agreement to explore and prove up Purdy’s Reward, located near Karratha, Western Australia.

From Artemis Resources.

Shares of both companies have skyrocketed this year (I’m late to the party as always… In this case, I HOPE it’s still relatively early days!)…

If Quinton Hennigh’s Precipitation Theory proves accurate, this COULD be the gold discovery of a lifetime…

Learn more below…

Shares of both Novo Resources and Artemis Resources are of course NOT CHEAP based off of fundamentals proven to date… These stocks are being bid up because of the blue sky potential that exists…

Novo has a much higher market valuation than Artemis Resources (and all the other juniors looking for conglomerate gold) because they have staked a whole lot more land than anyone else in the Pilbara region…

From Novo Resources.

Because it’s so early days and there are a million questions that need to be answered, it’s extremely tough for anyone to put a “fair” valuation on either one of these companies… My hunch is that Artemis Resources is currently the better “value” play simply because the ASX market is more asleep at the wheel than the TSX-V… Sure, there’s been a lot of buzz from the local Australians, but I don’t think shares of Artemis have been PUMPED UP to quite the same extent as Novo… I don’t sense the same degree of FOMO chasing just yet… which is why I guess I decided to load up more on shares of ARV.AX at this time… and besides, while Novo is waiting for permits to be granted so that they can start aggressively exploring their 100% owned land claims, in the immediate term, any “market shattering news” will be emanating out from Purdy’s Reward, which means that Artemis gets to share the spotlight each step of the way (for now).

Eventually, though, if Purdy’s Reward does live up to the insane hype/expectations, over the long-term Novo Resources should be the clear-cut winner; that’s why I think it’s worthwhile to own both companies if you’re going to speculate on Wits 2.0.

Quite frankly, I’m treating shares of NVO.V/NSRPF and ARV.AX/ARTTF as lottery tickets (that have much better odds for success)…

High risk, but exceptionally high reward…

These spec plays are NOT suitable for all investors, so please do your own due diligence and research before gambling on these stocks! What I try to do is make sure I balance out my portfolio with a lot of deep value plays whenever I decide to go chasing after elephants…

In the specific case of Novo Resources and Artemis Resources, what can I say other than:

I’m violating every “rule” in the book… but every now and then comes along a story that offers so much insane upside potential that you just can’t turn away… If this turns out to be the most significant and profound gold discovery in the history of the world, I don’t want to miss out!

It’s that simple… but I’m going in with the mindset that I could lose every last penny that I’m speculating with.

Conclusion

I made a lot of transactions this week… I tried to target after some deep value plays, such as: Dolly Varden Silver, Pure Gold Mining, NexGen Energy, and eCobalt Solutions. I also was able to sell off some Hummingbird Resources, which I think is fairly/over valued at this point in time… In addition, sold some Birimian Limited to reduce my exposure, even though this stock still makes up like ~16% of my portfolio… I’m about net-neutral with my Sandspring Resources allocation, having sold some but added back essentially the same number of shares via private placement. Lastly, I’m swinging for the fences again with my additions of Novo Resources and Artemis Resources.

Here’s where things stand now…

 

Until next time…

 

Fight On!

{ 6 comments… read them below or add one }

1 VinNo Gravatar October 21, 2017 at 11:00 pm

Some smart and thoughtful moves Jay. I wish I had some funds to invest at the moment 😉 I also jumped on the Novo/Artemis/de Grey bandwagon a few weeks ago. Let’s see..

Reply

2 FI FighterNo Gravatar October 22, 2017 at 10:10 am

Vin,

Thanks for the support! Haha, yeah I wish I had a lot more funds to invest with right now as well… lots of great deals out there.

In regards to Wits 2.0, yup, I like those 3 that you mentioned along with Kairos Minerals.

4 Horsemen of Wits 2.0
-Novo Resources
-Artemis Resources
-De Grey Mining
-Kairos Minerals

Of course, more juniors will emerge over time and we’ll get a clearer picture on who has the best ground staked… For now, I like the above 4 to play this conglomerate gold rush in the Pilbara region of Western Australia.

Cheers!

Reply

3 JeffNo Gravatar October 22, 2017 at 7:41 am

hello jay,

congrats on participating in the PP. I always wondered how shares are being received. Thanks to you, now I know your getting physical stock certificates.

But what do you do with them?
Send them to your broker?
Are the warrants also physical?
How are you able to sell them?

Reply

4 FI FighterNo Gravatar October 22, 2017 at 10:12 am

Jeff,

Yup, you get mailed the physical share certificates and warrants. There’s a 4 month + 1 day hold on them where you can’t trade the shares/warrants. Since they are in physical form, you can elect to convert them to digital by registering at Computershare and following the steps there… I assume you mail the physical shares back to them…

In regards to broker, I’m hoping/guessing you can go that route as well and that’s what I’m planning on doing… Exchange the physical shares for a digital version of them that you can trade online. Once they are in digital form, I assume it’s just trading like you would any other digital security.

Cheers!

Reply

5 SundeepNo Gravatar October 22, 2017 at 7:52 pm

Hi Jay,

I finally caught up on almost a year of back posts but am stoked to see your PM idea is working really well, especially considering it’s not taken off yet like you thought it would.

I’m 100% with you on trying to go where the herd isn’t and will look into opening a brokerage account to see about dabbling in the PM space myself. In past posts you mentioned using Schwartz Global or interactive brokers, do you still recommend either? Also, most of my funds are stuck in an etrade rollover IRA, do you know if I can just open an ira with one of these brokerages so I can transfer some money over without penalties or are you doing all the international trades post tax?

Thanks for the excellent info!

Reply

6 FI FighterNo Gravatar October 22, 2017 at 8:28 pm

Sundeep,

Hey bud good to hear from you, it’s been awhile!

In regards to PMs, yeah that thesis worked out well in 2016 but it’s been a real struggle in 2017 for the most part. I’ve had much better luck with lithium and cobalt so far this year. Still, I remain convinced the best is yet to come!

In regards to global trading, I use Schwab Global and it works well… Schwab One will get you access to Canada as well and is much cheaper so that route works well too.

With a rollover IRA, you should be able to trade foreign stocks, in addition to American stocks… You might have to buy through OTC ticker symbol, but it still works and it’s the same thing…

See here:

http://fifighter.com/precious-metals/2016/06/mining-stocks-why-you-should-not-fixate-on-the-otc-markets/

I own lots of OTC stocks through Vanguard rollover.

Cheers!

Reply

Leave a Comment

 

Previous post:

Next post:

Copyright © 2012 FI Fighter