Gold Has Returned Below US $ 1,900, How To Make Money With Copper
Catch up and stay up to date with this week’s content highlights from Charlotte McLeod, our Editorial Director.
Gold has had a turbulent period this week, starting the period above the US $ 1,900 per ounce mark, but falling to around US $ 1,870 on Thursday (June 3).
The yellow metal the decline was blamed on factors such as jobless claims in the United States, which fell below 400,000 this week, and a record for the country’s service sector index.
Gold had risen to around US $ 1,890 on Friday afternoon June 4. Looking forward to the future, I heard from Gwen Preston of Resource Maven this week. She has a positive outlook on the precious metal and is also bullish on gold stocks, which she says are historically still cheap compared to gold.
“Anytime you have a multi-metal market, it’s a much stronger phenomenon than a gold-only market” – Gwen Preston, Resource Maven
When asked what investors should focus on, Gwen said it is up to each investor to determine what is best for them. For example, she pointed out that high-risk mining stocks are not for everyone, and there are still plenty of opportunities in low-risk entities.
“I really stress that there is a huge amount of opportunity coming into this market across the risk spectrum. You can also do very well with low risk entities ”- Gwen Preston, Resource Maven
With that in mind, this week we asked gold investors on Twitter if their portfolios contain mostly high or low risk stocks, or a mix of both. In total, 43% of those surveyed said they focused on a mix, while 43% said they mostly focused their attention on high-risk stocks. Only 14% mainly focus on low risk stocks.
We’ve been talking a bit more about copper lately as it continues to see price momentum. It is of course important to be aware of the supply and demand fundamentals that drive the market, but what is the best way to get involved? I recently asked Byron King that question.
King, who writes the Whiskey & Gunpowder newsletter for St. Paul Research, which is part of Agora Financial, said that those who want to make money off the current price of copper need to invest money in big space players, such as Freeport-McMoRan (NYSE: FCX), BHP (ASX: BHP, NYSE: BHP, LSE: BHP), Glencore (LSE: GLEN) and Rio Tinto (ASX: RIO, NYSE: RIO, LSE: RIO).
“If you want to make money with the current price of copper… then you have to be a really big business” – Byron King, Whiskey & Gunpowder
Byron didn’t rule out the earning potential of small copper companies, but did point out how long it can take for a project to go into production – 15 years would be quick, and 20-25 years would be longer. Ordinary. This means that a small copper company could increase if it makes a discovery, but it is unlikely to produce during this cycle.
“If you want to invest in juniors… you’re not going to catch this cycle. What you might grab is sort of a pick-up from the early days of discovery excitement.
(So) don’t forget to sell along the way, because it takes years to turn an amazingly good find into a working mine ”- Byron King, Whiskey & Gunpowder
Finally, Bryan Mc Govern of INN recently attended a cannabis conference at the last Prohibition Partners LIVE event. Returning to the takeaways, he said the message from the panelists was clear: Cannabis investors need to look into the US market now.
We have heard this sentiment from many market watchers before. Overall, there is a sense of disappointment around Canadian cannabis companies – they got a head start when the country legalized the drug, but since then have disappointed in their financial performance.
As Thomas Carroll of Stansberry Research told the public, those waiting for the United States to put in place new cannabis laws will be late for the party.
“I’ve been telling people for six months that it’s time to invest in US cannabis stocks right now, and that’s really where we should be focusing as investors today” – Thomas Carroll, Stansberry Research
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Title Disclosure: I, Charlotte McLeod, do not hold any direct investment interest in any of the companies mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or completeness of any information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investment News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.