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Gold/Mining/Energy : Gold and Silver Mining Stocks
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To: ild who wrote (832)4/25/2001 1:55:51 PM
From: russwinter  Read Replies (3) of 4051
 
<People say the juniors move last.>

I think that's part of the pervasive negative sentiment and demonstrated mythology towards these stocks. The higher profile names that I mentioned not only move in the rally, but have much higher betas. Plus you have more event driven possibilities than the seniors: Claude mentioned discoveries and exploration results. Although it's been a while (Pangea for me), buyouts and takeovers needs to be put into the equation as well.

Sometimes liquidity dries up and these stocks trade poorly. And they can be victimized by indiscriminate dumping when someone with a few shares pulls the trigger. Vice versus when investors try to catch a moving elevator going higher.

And on occasion if you are alert there can be a very short delayed reaction (a few hours or a day). Case in point is my experience with Metallica the morning after their late afternoon news release regarding a spectacular discovery at El Morro. I found myself the only buyer at 29 cents on the open. In a classic snooze you lose syndrome the buyers showed up in force later in the day and week. Sometimes excellent results as opposed to the spectacular are ignored all together: Freewest at Clarence Stream recently, or FGX after the first Marlin reports.

I think you have to have a developer mentality with these stocks. Dealing with the illiquidity, sloppy selling by doing homework and preparation while others snooze is actually a big part of the attraction for me in the junior sector. At some point one hopes it pays off.
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