Portfolio Update: Adding to My Best Ideas (November 11, 2016)

by FI Fighter on November 11, 2016

in Precious Metals Updates

gqc_swa

When it rains, it pours… Lately, I’ve been posting a lot about precious metals and mining stocks, and that’s mostly because the sector is currently finding itself ensnared in a massive pullback (crash) that has seen prices slashed significantly in a very short period of time.

As usual, when an asset class is tumbling down the hill, everyone all of a sudden becomes a market timing expert who knows EXACTLY where the markets are headed next…

screen-shot-2016-11-12-at-7-29-45-am

Hah, dream on!

I still vividly recall the fall of 2015 and the beginning of 2016 when so many people were calling for the spot price of gold to fall below $1,000/oz… It almost felt like each time I was making more and more purchases of these mining shares, someone would feel the need to interject to tell me why I was making a stupendous mistake…

Well, guess what? Gold never did quite make it to $1,000/oz, and even now, there’s no way anyone can say with full certainty what will happen next…

But as usual, when sentiment is excruciatingly negative, I like to wake up and pay attention.

However, let’s make this crystal clear — I ain’t no damn goldbug!

Quite simply, I’m just an agnostic investor who likes to go hunting for deep value investment opportunities. No, I absolutely do not swear allegiance to gold, and the moment the entire precious metals complex becomes overvalued, I’ll be rushing in line to get my sell orders in…

Just keeping it real, guys…

This past September, my gut instincts were telling me that we were entering the 3rd inning or so of the re-emerging bull market in precious metals…

Posted on September 24.

 

sept-24_3rd-inning

 

With this most recent selloff, you can scratch that assessment… If I had to venture a guess now, I’d say that we’re now operating in the beginning of the 2nd inning, and if things continue to go from bad to worse, we will soon be headed back to the last stages of the 1st inning again…

That’s how beat up the precious metals sector is becoming!!!

Anyone who feels like they “missed the train for good” over the summer, well, here’s your chance to get onboard again… Granted, it’s NEVER easy trying to pick out market bottoms (an impossibility, really), but it should be blindingly obvious that the merchandise is now selling at a steep discount from just three short months ago…

For myself, I like to take the medium/long-term view on asset classes and investments, preferring to focus on the macro picture as opposed to short-term noise and volatility… With that said, I honestly do believe that all the reasons that made gold and silver such compelling investments this past year still hold true (if not more true) today… In a world of too much debt and Negative Interest Rate Policy (NIRP) and Zero Interest Rate Policy (ZIRP), I think it makes a ton of sense to hold a sufficient allocation in precious metals… In my own case, I’m somewhat of a loon, and don’t mind being allocated essentially 50% mining (hard asset commodities, both physical gold and silver bullion, along with mining stocks focusing on– gold, silver, lithium, graphite, cobalt, copper, uranium, etc.) and 50% real estate (actual rental properties, not REITs)…

No, I don’t give out investment advice and would of course NEVER recommend anyone else attempt to do what I’m doing here… But with that said, I won’t bullshit readers and ramble on and on about things that I’m not actually doing myself…

Anyway, I used today’s bloodbath to add some more shares of some of my favorite gold stocks.

 

  • Bought 31,500 shares of GoldQuest Mining (GDQMF) @ $0.214/share (~C$0.2898/share)
  • Bought 21,300 shares of Sarama Resources (SRMMF) @ $0.152/share (~C$0.2058/share)

 

I now own 79,000 shares of GoldQuest Mining (GQC.V/GDQMF) and 80,000 shares of Sarama Resources (SRMMF).

I didn’t catch the day’s low with these purchases, but rarely does that ever happen for me… Quite frankly, I’m not that good, and I won’t ever pretend to be… But at current valuations, the shares are cheap enough where I have no problem adding to my positions…

Could things get a whole lot cheaper?

Absolutely!

But similar to the fall of 2015, I’ve seen this song and dance before… My conviction is such that I am not easily deterred, and I have an iron stomach when it comes to market gyrations and volatility… My risk appetite is also high enough where I have the ability to look at a portfolio that is bloody beet red, and not get all emotional and distressed about it…

Please note: I also like to use smack and blind you in the face yellow as an alert signal to let me know when my portfolio is performing most atrociously (when any individual position is in excess of -20% drop).

Earlier this year, on January 19, my portfolio was down about -$60,000

Depths of Despair 1_19_16

The Game of Rocks ain’t easy, so if you’re an emotional individual who is entirely too fixated on day-to-day price action movement, well, what can I say? This ain’t the right type of investment/speculation opportunity for you…

But that’s ok… We all just have to stick to what works best for our own unique situations…

As for me, I have been and will try and continue to buy hand over fist… These mining stocks are dirt cheap right now… I have no other way of putting it.

To conclude, here’s my short list of best ideas right now.

screen-shot-2016-11-12-at-7-50-01-am

And their corresponding share price performance over the last three months.

gqc-v_ssp-v_org-v_swa-v_aan-v_chart

If prices stay at these levels or head lower, I will be very keen on adding many more shares of Sandspring Resources (SSP.V/SSPXF) and Orca Gold (ORG.V/CANWF).

And that mysterious Aton Resources (AAN.V/ANLBF)? I haven’t discussed this stock in any detail on this blog yet, but that’s my sleeper pick for an emerging gold play that I think will greatly outperform its peers on the next leg up… Aton Resources is a very early-stage exploration story, so risks are a bit higher than some of the other names mentioned above, but at its current market cap, I’m really liking the growth potential and upside here…

I will disclose more thoughts at a later date, but right now, I will be open and admit that I’m actively trying to add more shares of ANLBF to my portfolio.

Anyway, that’s all for now…

As always, please do your own due diligence and research before making any investment decisions… I do not offer investment advice and am only posting these updates to share with readers what it is exactly that I’m doing with my own money.

 

Precious metals mining stocks are hated by the market again!

 

Lock and load…

 

Happy Hunting!

{ 8 comments… read them below or add one }

1 AlexNo Gravatar November 11, 2016 at 4:22 pm

Loaded up today as well on some of the same names I even threw some money at some weed stocks as well because the entire sector has gotten destroyed even with the passing of the laws in 3 states crazy to me I could be wrong but we shall see I feel totally fine as well with being 50% allocated into some high risk stuff / gold plays !

Reply

2 FI FighterNo Gravatar November 14, 2016 at 6:16 pm

Alex,

Best of luck on those purchases! Now seems to be an opportune time to load up on some quality names.

All the best!

Reply

3 vinit apteNo Gravatar November 11, 2016 at 4:34 pm

Thanks for sharing Jay.I also loaded up Sandspring resources(SSPXF) @ 0.312. Looking to add Sarama and if it continues to trade at this levels next week.

Reply

4 FI FighterNo Gravatar November 14, 2016 at 6:17 pm

Vinit,

Sandspring is one of my favorite buys at this time. I just added some more shares myself @ C$0.38/share.

Looking forward to how this stock does in the future, especially if gold can get back on track and resume its bull run.

Cheers!

Reply

5 Dividend TenNo Gravatar November 11, 2016 at 7:19 pm

Interesting picks which I’m not as familiar with, I’ll have to look at some of these closer.

Reply

6 FI FighterNo Gravatar November 14, 2016 at 6:18 pm

Dividend Ten,

Yeah, these are smaller caps, so relatively unknown and obscure. Just my own honest and humble opinion, but I think the list above represents some of the best deals in the mining sector right now.

All the best!

Reply

7 NickNo Gravatar November 12, 2016 at 6:52 am

How does physical metals fit into your asset allocation? Is it included in your 50% allocation to mining stocks, etc. I split my allocation between miners, equities and physical metals.

Thanks

Reply

8 FI FighterNo Gravatar November 14, 2016 at 6:19 pm

Nick,

Physical gold and silver are represented in the 50% mix… I revised the post above to clarify on that point. So, 50% of my assets are essentially mining stocks and physical bullion… The other 50% is in real estate…

I don’t consider cash an “investment” per se, so I don’t include that in my investment mix… I have some cash, although I have splurged and spent a large chunk of it on more miners.

All the best!

Reply

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