Portfolio Update: Gold Mining Stocks (April 28, 2016)

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Although the bulk of my focus has been on water fasting these last two weeks, I did make some time to refine my portfolio a bit. Actually, I’ve made a whole bunch of moves lately, but rather than get into all the details at this time, I will instead provide readers with a snapshot of where my portfolio currently stands. Anyone who has followed this blog for awhile is well aware that I like to share my best ideas as they are happening in real-time, as opposed to after the fact, with the benefit of hindsight.

With that said, these days, my investment focus is skewed heavily towards lithium. As I mentioned previously, yes, I am very much late to this party… but that’s relatively speaking. In the grand scheme of things, I believe we are just in the 1st inning of the lithium story, and there will be much bigger gains to be made in the upcoming future. In general, as you guys know by now, I like to go hunting either for deep value (gold and silver in 2015, Bay Area real estate in 2012), or look for emerging trends… Sometimes you win, sometimes you lose… With lithium, I think the electric vehicle (EV) revolution is a no brainer just like smartphones were, but only time will tell. In any case, I’ve been putting in a lot of time doing research, and will most likely be publishing a lot of lithium content once I finish my water fast.

Yes, I realize that I’ll probably lose some readers and subscribers because of this “shift in focus”. I wouldn’t be surprised, it was no different than with gold and silver… But as I’ve learned, sometimes you just have to stick with your gut and do what you think is best for your own particular situation… There will always be haters, so don’t let them deter you from your goals.

With that said, here’s where my portfolio stands today (which doesn’t account for short-term gains that I booked along the way on a few positions, but does factor in a lowered cost basis on positions that I trimmed and didn’t outright sell out of completely). Most recently, I pruned some of my Perseus Mining (PMNXF) shares to book some quick profits.

Screen Shot 2016-04-28 at 10.59.23 AM

 

Honestly, I believe it’s far more beneficial to readers for me to post updates when my portfolio is beet red… Like anyone else, I learn a lot more about investing when my portfolio is performing terribly… which is why I’ve refrained from posting these portfolio updates… they are no longer necessary as long as gold is ascending. So far, my portfolio is doing decently, although I do realize that I am underperforming a lot of other investors who made some far superior picks… Oh well, I’m content with my gains, and I did the absolute best that I could… I made a lot of mistakes that I wish I could take back, but overall, I have no regrets.

Hindsight is ALWAYS 20/20.

As a wise person once said, “Never confuse a bull market for brains“. When the tide turns, you can buy almost anything and you’ll make money… I like to call it “Blind Dart Investing”, which is the case right now for gold and silver mining stocks… Just close your eyes, buy ANYTHING, and you will make money (essentially)…

Big money is made in the macro NOT the micro!

As I alluded to repeatedly over the last year, I honestly felt that these mining stocks were a screaming buy, a golden opportunity for those daring enough to play:

Precious Metals: My Bear Market Strategy

Want to Become a Millionaire? Think like a Geologist

Bear Markets Create Millionaires

Buying Real Devastation – Forget the “Dividends”

 

But like I said, when you’re buying when there is “blood in the streets”, it’s an extremely lonely trade… You feel like an outcast because almost nobody understands what you are doing… During the last half of 2015, I was losing readers seemingly everyday, and received more than a handful of snide comments and e-mails from folks who were telling me I was “insane”, “crazy”, “delusional” and outright “stupid”…

Such is life…

But when you’ve got full conviction, you learn to tune out the noise and to keep right on marching forward…

Now, the gold sector is back in favor again and so many people and their mothers want in on the action (I’m not joking about the mothers part, I have seriously had friends who have told me their moms want to buy now)…

To me, this is all entirely frustrating!!! We all learn to “buy low and sell high”, but when you try to do that, you feel like the biggest (and loneliness) idiot in the entire world… You get accused of “trying to time the market”, thinking that you’re so damn smart and superior to everybody else (just stick to index funds and dividend growth stocks your critics will say)… It’s not that… I just like to buy merchandise when it’s SUPER CHEAP and on the clearance rack!

Now, with lithium, it’s a riskier play, I would argue because I’m NOT chasing deep value this time around. I’m running after a moving train… But if you look at where the future is headed, you would have to be a total fool to dismiss the EV revolution and to ignore the profound ramifications it will have on our world… Forget Tesla and its new gigafactory… I’m more concerned with China and the revolution that will take place over there which is why I’m taking the time to do my research so that I can learn more and get properly educated in the space… I am NOT the type of guy to just dismiss ideas without putting in the necessary due diligence first (that would be so outright stupid for me to do!)… So, I’ve started hunting after stocks outside of just North America, which is something so many US and Canadian investors refuse to do and for the life of me I can’t understand why… I’m keeping my eyes and ears open… you have to! I’m willing to invest in the very best lithium companies to play this trade… And right now, my research is clearly pointing me to Australia, so that’s where my money is going…

Here’s how I’m positioning myself for the future (more specific details as to how/why I chose these companies will be detailed in upcoming posts/articles):

  • Galaxy Resources (GXY.AX/GALXF)
  • Pilbara Minerals (PLS.AX)
  • Pure Energy Minerals (PE.V/HMGLF)

 

I’m not finished… I’ve got 2 other companies (Australian based) that I’m eyeing as well, but I’ll keep those names to myself in the meantime (need to do further research to confirm my thesis first)… 😉

Again, we’ll see if this works out or not… It could wind up being another big dud of mine, just like Alibaba (BABA) was… My track record clearly shows that I perform much better when I am indeed chasing deep value as opposed to momentum…

 

But I like to swing for the fences… That’s just my nature.

 

So, feel free to call me a moron again… It wouldn’t be the first time (or last) that I’ve been told that…

 

Photo Credit: Pretium Resources

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FinanzrBeSmartRichTomboonNewB Recent comment authors
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Income Surfer
Guest

Haha, thanks for the update Jay. I think there are huge opportunities in Lithium as well, but like we’ve discussed…..I feel like I’m too late to that party. You are a much better momentum investor than I am…..and I wish you luck.

Fantastic profits in that portfolio by the way. Fight on!
-Bryan

Tawcan
Guest

Talk about big shift in portfolio value, holy cow! Lithium sounds like good opportunity, will see what’s out there.

Mike
Guest
Mike

Proving all the haters wrong!

Nice job FF. Looking forward to reading your research on these lithium plays.

MiningBookGuy
Guest

Had the same immediate reaction as Tawcan…”HOLY COW!”

Wow Jay, you have master timing! Really interesting you’re getting deep into lithium…i’ll still hold out, but no way am I leaving this blog! Great reading as always, and glad to hear the awesome water fasting progress too.

Will try to catch up with you soon. Got some “lithium buddies” you might want to get in touch with. 🙂

MBG

James
Guest
James

I love your investment philosophy of buying deep value and have profited from it. Living in Reno where real estate prices have topped out from the Tesla effect, I’m more cautious oabout buying into your lithium thesis. I’m looking forward to reading your research and perhaps I’ll be convinced to sell some
Of my gold for lithium.

On a related note, China is planning to build more nuclear power plants to reduce their air pollution. They’ll also be needed to recharge all those electric vehicles. I was curious if you had any thoughts about uranium as its been in a deep bear market for years.

JP
Guest
JP

If only the haters listened like some of us did. Where are they now? That’s phenomenal what you have done with gold stocks. I’ll follow you down the lithium road as well. You’re the man.

Investment Hunting
Guest

I’ve been looking into companies with Lithium stakes. Last month I bought 5,000 shares of Dajin Resource Group (DGIFF) and earlier this week I bought 3,500 shares of Nevada Energy Minerals (SSMLF). They both have interests in Nevada Lithium. It’s my first step into mining stocks.

Financial Samurai
Guest

Simply amazing! HUGE props to you on your investments!

Sam

JGMS
Guest

A list of Lithium stocks I put together here, there are a few more to update.
The Aussie stocks have been moving up for quite a while now.

http://juniorgoldminerseeker.blogspot.co.uk/2016/04/lithium-stock-list.html

Reepekg
Guest
Reepekg

Impressed how much your detailed investments put my 44% up GDX to shame. Congrats, man. Like you say, I threw a blind dart on this one and was lucky you flagged up the right time for doing so.

I’m not sold on Lithium, but I’ll be interested in what you have to say. My understanding is that Li isn’t physically scarce… maybe just economically feasible more in some places than others. That would make me worry about limited upside if new players can always just jump into the market whenever the price goes up a bit.

Bowman
Guest
Bowman

Thrilled to follow your journey – also in the lithium world. Best of luck!

NewB
Guest
NewB

I’m new to your blog and investing. What brokerage company do you use to trade stocks?

boon
Guest
boon

Hey FI Fighter,

did you already receive your PRU shares and warrants?
I’m still waiting…

best regards
boon

Tom
Guest
Tom

Hi!
How long you think this bull market for gold and silver last?
Is it too late for me to buy silver miner stock?
Can EXK double from here or it’s too expensive now?
What is your thought?
Thanks!

BeSmartRich
Guest

Unbelievable. You always impresses me with your macro level purchasing decisions. I remember reading your it’s beet red in January and made my first gold stock purchase which was up 150% by the way but dropped to 70% up after earnings report.

Great job!!!!

BSR

Finanzr
Guest

I love how you have developed and researched a gameplan and constructed a portfolio around this. It does look like it is going to play out very nicely for you and I have to admit, that I borrowed some of your ideas to use gold mines as a hedge for a downturn in the general stock-market (which I am sure will come rather sooner than later) and negative interest (people will use gold to store their money, rather than paying penalties on having it in the bank…). I did not have your foresight and also have heavily burned my fingers in the gold mining sector in the past years. Thus, I am a bit late to the party, but I think it is still about to get started, so we ought to have some fun together…
One question regarding your Amara/Perseus investment: I jumped on that train with you and was wondering wether you have already received your warrants? I have not yet received them and my broker does not know anything either…

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