Re: Largest and Most Respected HF's Decline Sharply
in response to
by
posted on
Apr 09, 2008 10:21AM
Golden Minerals is a junior silver producer with a strong growth profile, listed on both the NYSE Amex and TSX.
Hi jmreport, your concerns are most warranted as just about every investor in PM’s right now has very similar thoughts. The disconnect between metals and shares has been going on now for several months and the disparity is increasing. It is definitely not the fault of ECU or its fine management because the majority of juniors display nearly identical trading patterns. Resources and positive news seem to have negligible effects at this time.
The forces behind this growing disconnect are varied depending on who you read or speak with. The most common ones I have identified are hedge funds, the gold cartel, and even the big miners. If one investigated each one closely enough, it would be revealed that all would have their own valid reason(s) for suppressing junior prices.
Regardless of who is behind this, our intuition should tell us that it cannot be an infinite occurrence. There are some experienced PM investors out there who have never witnessed such a profound disconnect between the metals and shares throughout their entire careers. So whatever the cause, it is likely that something very different is going on this time.
When we look at the financial markets, it is evident that the approaching bad weather is quite unusual and definitely a century storm. I can give you several pages to support this claim but the previous posts on this board by everyone should make events clear enough.
So based on this financial calamity, it would be most prudent to have a sizeable portion of your portfolio in traditionally safe PM’s. At any time now, we could have a major move up in gold and silver that would probably even shock the bulls. Likewise, the juniors could rocket up at any time. When is the golden question!
In addition to high calibre management and of course positive drill results, there is another vital factor that helps one decide whether or not it is worthwhile to invest in a miner, or for that matter any other equity, and that is the knowledge and reputation of existing shareholders. I for one can attest to the fact that ECU has had and still does have an A-1 investor profile. Luckily for us, we even have the luxury of regular posts by some of these key individuals on this site. So you see, the presence of these select shareholders my friend is further confirmation that ECU will continue to deliver major returns to the wise.
Good luck - VHF