A Hidden Gem in the Silver Markets

With two promising catalysts for growth

As long-term readers of my stuff will know, I am somewhat ambivalent towards silver. There is no metal with as much potential. There is silver in just about every computer-related electrical device you can think of, so its industrial use make it very attractive, particularly as a “picks-and-shovels” play on tech. Then there is the fact that, in these inflationary times, silver is a monetary metal as well.

Relative to gold there is no doubt silver in undervalued. There is 12 to 15 times more silver in the world than gold, so gold should trade at 12-15 times the silver price. It doesn’t. It trades at 83x the silver price. Were the ratio to return to its “natural” levels, silver would be somewhere near $150. No such luck. This is something, due largely to the vagaries of silver markets and the fact that silver is largely sold as bi-product, that never gets realised. One day, Rodney.

That said, silver has a big following, especially in the US, and, at some point, when people are least expecting it, silver is suddenly going to reward its followers.

Despite my ambivalence, I own silver. (My guide to investing in silver is here, and if you want to buy physical, here is where to go). I own the metal and I own a couple of mining companies. There is one, in particular, in which I have a large position.

It’s very cheap for what it is, even by the standards of today’s markets; it is well run and it is not well known. But the company has two catalysts coming up, which, I think, could put the company on the map, especially among North American retail investors, and cause it to be significantly re-assessed by the market.

I met with the management last week. This is just a heads up: I really like what I heard.

Now could be a good time to take a good look at the company, and maybe get long the stock.