Erik Wetterling – A Value Investing Approach To The Negative PM Sector Sentiment
Erik Wetterling, Founder and Editor of The Hedgeless Horseman website, joins us for a candid conversation about how he approaches value investing in the gold and silver mining stocks, when the sector sentiment is so negative. Erik points out the cyclicality of the PM sector, and that “this sector sucks about 80% of the time, and then retraces back up the suckage about 20% of the time.”
Erik’s approach is to keep it simple looking for the cheapest stocks based on where their future valuation should grow into, based on their current banked success in the ground, or the company work strategies to build more value. If things change where a particular stock gets substantially cheaper relative to the other stocks in his portfolio or watchlist, then he will do some value-shuffling within his portfolio to rebalance accordingly. Another point he reiterated is that his edge is in evaluating the risk/reward setups on the micro company level, and not getting lost trying to follow all the macroeconomic data points or factors so many concern themselves with on a daily basis.
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I was watching Santacruz go down today, and I thought WOW, 5 mines and someone is dumping because they need money. This isn’t over yet it could be on the elevator going to the subfloor and then I want to be a buyer. By the way, I have been prepping lately, it doesn’t look good, and I’m not kidding. DT
Santacruz Silver Produces 5,569,535 Silver Equivalent Ounces in Q2 2023
9 Aug 2023
https://ceo.ca/@newswire/santacruz-silver-produces-5569535-silver-equivalent
That kind of production profile from SCZ (about 20,000 ounces of silver equivalent annually) is in the mid-tier producer zone, and yet they are priced like the tiny producer they once were. It may take the market a while to realize how Santacruz Silver stacks up to their mid-tier peers, but over time a large re-rating higher from these valuation levels is in order…
I bought back in today as they have been punished to a crazy low valuation for a producer even if they have made mistakes… I may buy more also in the sub .20 range.
I have been mailing in my silver shares to Jamie Dimon for his collection, but .14 for Santacruz is ridiculous. I am going to ask for those back..
The creature from Jekyll Island isn’t about to hold the line on rate increases, they preferred to rely on their new policy which is an increase in the call money rate. If you don’t know what you are doing it is best to not change course when what you are doing doesn’t work out just keep sailing ahead.
Once again hundreds of thousands of requests for more money will find their way into speculators e-mail boxes and hundreds of thousands of speculators will be sold out with the loss of everything they owned. DT
Thanks for drawing my attention to santa and his presents—I believe I’ll begin to purchase some tomorrow.
It could be up double digits like CDE after being mentioned here.
Again, more gems of wisdom from HH, thank you very much.
It will be helpful to have more PM junior company interviews and less Hedgeless Horseshit interviews.
That’s a terrible thing to say. I am so disappointed.. Need I say more.
There have been many company interviews recently with very few if any comments.
Terry:
You are right and I am personally burned out on market intervention. After over a year and one-half of computer control pushing prices down in order to try and coverup the massive thefts of Corporations and Politicians, it is hard to get motivated to comment on the miner interviews. Ut does not mean I don’t listen to most of them, but it is hard to think about stock substitutes for what I have when most everything moves downward for no rational reason. I feel like I have to guard my shares to keep managed money from buying up the Sector because they can. They have cornered the silver market and the housing market and the only recent failure they have had is not getting their Fascist President. When intervention dominates and there are no regulators to stop it, it causes great concern that a real metals market could never be fundamentally available to investors again, or any markets. Let’s hope it doesn’t get to that as that will be the least of our problems. A soft landing is a pipe dream. Just my thoughts.
I also bought Santa Cruz today, under 14 cents. Glad to hear it is good value!
Tried to buy some Santacruz at .14 which matched the current price on the OTC. Schwab moved the price to .18. A few minutes later, the OTC raised the price to .149. I cancelled the buy order and added to Snowline. OTC raised the price of Santa to .18. Schwab’s computers are set up to lower or raise the individual buy or sell order price when you press “enter”. Doesn’t mean you won’t get your original offer, but if you don’t, when you try to modify, you will deal with the false prices. In other words, all bids are modified based on the individual and they may be containing a Schwab bonus from market. Just my recent experience.
The strong intervention in the US Markets is a prelude to Jackson Hole shenanigans. They are diverting us from thinking about the corner they have painted themselves into as a result of the transfer of wealth they have inflicted on the tax payers over the years. They are boxed from having a rational explanation for the damage they have inflicted. They will not admit fault or do they have a solution. It is very possible they could move forward in a draconian fashion to negate criminal action against the whole of Central Banking, thereby putting political participants at risk also.
Speaking of watching for stocks that drastically correct in one’s portfolio to take advantage of the better risk/reward setup and rotate some money out of others to take advantage through value shuffling….
I reduced some exposure in a few other names, to add some more to my position in Santacruz Mining (SCZ) on their big waterfall decline today. There are some wild moves in many juniors on a daily basis and this was another clear example today.