Rise of the Silver Surfer (April 19, 2016)

2010-American-Silver-Eagle-Bullion-Coin

Silver is up 4.85% this morning… If this comes as a surprise to you, it shouldn’t… Over the last few months, it was CLEARLY evident that the silver stocks were telling us something was brewing behind the scenes. To me, it made absolutely no sense why the stocks had multiplied by 2x or 3x, while the physical metal was languishing at around $15-16/oz.

Well, silver finally broke out today… Gold moved higher as well, but just as everyone says, in an upmarket, silver will ALWAYS outperform gold. The gold-to-silver ratio is about 76 now, which means that it still has a loooooong ways to fall, if we are to get back to a more “normal” level of 50 or so.

Screen Shot 2016-04-19 at 6.27.08 AM

As for the silver stocks? They are continuing their 2016 tear and reaching new heights.

AXU_BCM.V_EXK_AG_FSM_GPL_SIL.V_chart

Year to date:

  • Alexco Resource (AXU) up 253.1%
  • Bear Creek Mining (BCM.V) up 262.1%
  • Endeavour Silver (EXK) up 147.9%
  • First Majestic Silver (Ag) up 192.2%
  • Fortuna Silver (FSM) up 132%
  • Great Panther Silver (GPL) up 183.3%
  • Silvercrest Metals (SIL.V) up 381.3%

 

When it comes to a bull market in precious metals, these are EXACTLY the type of results investors look for (why else would anyone bother to play in such a “risky” sector?). As I’ve mentioned so many times before in the past, the performance to the downside can be drastic, but typically, so is the outperformance to the upside when the tide finally turns… and it always does, eventually… No asset class moves up or down in a straight line for perpetuity, contrary to what many investors might think. You just have to be patient. Anyone who doesn’t study up on the history of mining stocks usually misses this critical point, and thus refuses to participate in this space, even when the shares are trading at a 95% discount, or for less than cash in the bank.

That’s unfortunate, because the gains that can be made by investing in mining stocks are indeed life changing.

 

With that said, I still believe that we are in the very early stages of the next bull market in precious metals, call it the 2nd inning if you will.

 

The party is just getting started…

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sravsFI FighterInvestment HuntingRoadmap2RetireIncome Surfer Recent comment authors
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Income Surfer
Guest

I saw this and thought of you this morning. We did talk about the gold/silver ratio last week, and your predictions proved accurate. I hope you’re having a great week so far buddy

-Bryan

Roadmap2Retire
Guest

As I read more and understand the precious metals and mining space, the more I think silver as a good investment. On first thoughts, it feels like I missed the rally, but like you said – the party is just getting started. I am thinking about making a move provided I can find the right vehicle.

R2R

Investment Hunting
Guest

Hi FI Fighter. Do you recommend any EFTs or Mutual Funds that are focused on this sector? I’m interested in buying into the space, but not having experience here, an EFT might work better for me than individual stocks. Thanks

sravs
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Is it still late to get into the silver etf.

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