I think the Seniors are the best buy right now for shorter term gains. One, they're tougher to manipulate. Two, they have more people (and traders!) who follow them. Many people have simply thrown in the towel with the Juniors. My Dad is a broker, and he can't even buy many Juniors at his firm. Three, when the metal prices turn up, the seniors are the first to confirm. The Juniors may or may not - but they tend to lag. What is psychologically damaging for me is to watch the Seniors take off, and the Juniors sit...and sit.

So, I do a monthly 50-50 split between two accounts, and fund a third one once a year. Let's say this month I have $4000 to invest. I might put 50% into Juniors in one account, where I can buy the TSX but pay a little more per trade. That is my Simple IRA from my small business, and I rarely ever trade it. It can sit there, look at me cross-eyed, do nothing, whatever. At some point, that silver and gold will come out of the ground. I buy quality.

In my other account, which is the taxable account, and not for retirement, (and also is scrutinized by my wife), I buy senior producers and oil trusts. This is not a trading account, but a buy and hold type account. I'm still waiting for oil to finish going down before I buy more oil - looking for sub 110 to nibble and sub-100 to go all in. $92 oil is a 38% fibonacci retracement from $147.50. I like Eric King's picks - there are some pretty good presentations up about GG, AEM, and AUY on their sites. I also like SLW. I would be a huge fan of Kinross and call it the Fourth Horseman of the Apocalypse if it weren't for the mine in Russia. (GG, AEM, and AUY are the other 3).

In my third account, a Roth, which I fund once a year in January, is for trading only, and I zip in and out of the gold sector. It is tax-deferred, so I can trade all I want without worrying about capital gains, triggering an audit, etc.

I believe that the best LONG-TERM value is in the juniors. Shorter term, when the metals rise, the senior producers should confirm if the rally is real. The juniors should as well, and may even outperform, but ...the odds are with the Seniors. They'll be more liquid if you want to trade. If the seniors rise and the Juniors don't, you'll be able to buy more Juniors, assuming they remain beat up. Price and Value are not the same thing.

This class-action lawsuit in Toronto that JP mentioned could be a real wild card that MAY (or may not!) cause massive short-covering in the juniors. Legal processes tend to be drawn out, so I would continue to expect more pain shorter term. But, it can turn around at any time, so I am simply buying. These SOBs shorting the juniors are arrogant and will not change their ways until confronted with consequences.

If you think of your Juniors as looking at you cross-eyed when they go down in Price, but still having the same Value, it should bring a smile to your face, and help you to laugh at the absurdity of this present situation. Everything going wrong in the world, things worse than ever, but gold goes down and is also nearly unavailable.

CD