Robert Sinn – Reviewing The Recent Rule Symposium, And The Copper, Gold, and Silver Resource Markets
Robert Sinn, (aka Goldfinger on CEO.ca) and publisher of Goldfinger Capital on YouTube, joins us to share his key takeaways from the Rick Rule Symposium in Boca Raton, FL last week, as well as thoughts on the copper and precious metals sector.
At the Rule Symposium, Robert Friedland, the Founder and Executive Co-Chairman of Ivanhoe Mines (IVN), discussed the supply demand factors for the copper sector, in light of the electrification and electric vehicle narratives. He also mentioned that now that the Fed is nearing the end of their rate hiking cycle, that he expects a very constructive environment for commodities and resource stocks over the next decade. This led to a discussion with Robert about why we’ve not seen more traction in the junior copper resource stocks, in light of the overall consensus about how important bringing on more supply of the red metal is so critical.
This also tied into a similar disconnect in the valuation of precious metals stocks, in light of the higher levels where both gold and silver have been trading for some time now. We reviewed how inflation has crimped margins and spiked the capital costs needed to bring new mines into production, but doesn’t quite explain away the vast disconnect in valuations today compared to when metals prices and margins were lower than they are in today’s environment. Whether it is because other speculative sectors are taking some of the shine off gold, or if we just need to see a big breakout that gets more investors attention, Robert makes the point that the PMs have held up quite well considering everything we’ve seen on the macroeconomic radar the last few years. He provides some technical pricing levels for investors to keep their eyes on.
Goldfinger goes on to note that being a contrarian in this space, and acquiring quality teams and projects when they are least coveted can lead to outsized returns when the sentiment does turn again in the sector. He wraps up discussing the importance of position sizing and time horizons, and that investors should develop their own unique strategy around these and their own risk tolerance parameters.