3 Crucial Takeaways From The Sprott Symposium -- #2 Is A Buy
On Monday morning outside Vancouver BC, I headed 800 meters up a mountain to learn more about the gold market.
My adrenaline kicked in as the gondola vaulted off the platform. Because while I’m an adventure seeker, heights always seem to catch me off guard.
But this gondola event was the kick off to the Sprott Natural Resource Symposium.
And this was my ticket to get one on one time with some of the keynote speakers, like our very own David Stockman and Jim Rickards, as well as a myriad of other experts in the gold and mining industries.
First, let me just say that once I finally got to the top, the views were stunning. For those of you with the chance to travel to Vancouver, I highly recommend it.
But let’s get back to what you’re really her for — to grow and protect your wealth.
Today, I want to share with you my biggest takeaways so far, as well as one MAJOR opportunity…
Today’s takeaways come from the summit panel discussion hosted by Riverside Resources, featuring industry experts Adrian Day, John Marc Staude, and Nick Hodge.
Takeaway #1: Swimming With the Tide
In a bear market for gold, you can still make money buying gold stocks because these companies can still be profitable by selling gold at a higher price than it costs to mine.
But the environment is challenging.
So while it’s a good idea to have some exposure to gold and silver at all times (a great balancer to your portfolio), you want to increase your holdings ahead of, or in the early stages of a bull market for gold. And then lighten up exposure when gold is at the end of a bull run.
Incidentally, we’ve had some rough years for gold.
But this year, things are turning around. Gold is moving higher. In part to higher inflation of the dollar, and also because investors are starting to get weary of the almost decade-long bull market for stocks.
Which is what makes now a great time to start buying gold, silver, and mining companies.
Because as I’ve explained in previous editions, the ending of the bull market for stocks signals the beginning of the bull market for commodities. I recommend getting in sooner rather than later…
Takeaway #2: Silver Over Gold
A popular subject has been that an ounce of silver currently costs only 1.3% of an ounce of gold. In other words, one ounce of gold is roughly 75 times more valuable than silver.
Why is this so important?
Because silver is extremely cheap as a precious metal. And to me that doesn’t make sense.
Think about it…
We currently only mine about 9 ounces of silver for every 1 ounce of gold – not 75. So silver is more rare than the price gives it credit for.
Plus, silver is actually consumed for many purposes (versus gold which is mostly stored) – so there is natural demand for silver built in.
Bottom line, when the tide for commodities starts to turn, I expect silver to rebound like a slingshot, much higher (percentage wise) than gold.
Don’t get me wrong, gold should still be apart of your balanced portfolio. But I recommend you start paying more attention to its less talked about little brother, silver…
Takeaway #3: When to Buy and Sell
This is a great reminder for ALL investments, but it’s a good reminder for gold and silver investments too.
Always have a reason WHY you buy something.
Maybe you’re expecting a certain mine to produce greater amounts. Maybe you believe gold prices will hit $2,000 by the end of the year, or some other expectation that causes you to want to buy an investment.
But whatever the scenario, you should be continually evaluating whether your original thesis is actually panning out.
If so, continue to hold your position until your expectation fully pans out.
Once the expectation has occurred — go ahead and SELL your position. Your expectation has been fulfilled and it’s time to come up with a new idea.
If things go differently than expected, and your thesis isn’t panning out, then that’s a signal to sell.
Too many investors come up with a new reason to hold a position once their original thesis proves be over – or doesn’t pan out. That’s a sure fire way to give up gains, or take on losses.
Bottom line, don’t change your reasons for owning a stock to justify keeping a position. Instead, let a position go and start with a clean slate. That will help you make much better investment decisions.
I’m headed back into the conference to take notes on additional speakers, and to meet some legendary investors and natural resource company managers.
I’ll keep you posted on what I’m learning at this conference— along with some great ideas for how to use natural resources to pad your retirement account.
Here’s to growing and protecting your wealth!