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.