Investing

The best way to look at miners, in relation to gold, is to look at the relative strength of each which is most clearly illustrated through ratio analysis. Whether you are a fundamental or technical analyst, both schools of thought support the notion of investing in sectors that exhibit positive relative strength. For those unfamiliar, the idea is that relative strength tends to persist over time and that it is often best to invest in securities that exhibit positive relative strength. [So what does relative strength analysis suggest is the appropriate course of action these days? Let's take a look.] Words: 805

We’ve been surprised at the recent action in the precious metals complex. During the recent correction the shares were showing quite a bit more strength than the metals. Then the shares took a dive below support yet the metals maintained their recent lows! How do we interpret this wild volatility in the relationship between the shares and the metals? Quite often we look at daily and weekly charts. Now is the time to take a look at the monthly charts which can help us get a better read on the larger trends at hand. Words: 636

Of the 1040.6 million troy oz of silver produced in 2011, 84% was used in over 10,000 modern industrial applications (16% used as an investment) of which approx. 33% was used in the traditional forms of fabrication such as jewelry, coins, medals, and silverware with the remaining 66% actually being consumed. While the actual amount is unknown, some experts believe as much as 90-95% of all the silver ever mined has been ‘lost’ to landfills. For this reason, there is likely less silver available above ground than gold (98% of all gold is accounted for today). For more interesting information regarding the supply of, and demand for, silver please refer to the infographic below.

Gold is one of the rarest minerals on earth. To put that into perspective, more sheet metals is pored each hour than the entire amount of gold poured throughout history. That being said, the USCS estimates that silver in the earth's crust will be depleted by 2020 at the current rate of consumption. For more interesting facts about gold and silver check out the infographic below and the links to many other such gems of information.

The movements and potential movements of the yellow precious metal often grab the spotlight, even if there are other assets outperforming it. It is always important for investors to look beyond the major headlines to get a better perspective of the trends impacting the overall commodity world. [This article does just that and also identifies 3 ETFs to possibly take advantage of these trends.] Words: 440

If you believe (as I do) that gold is a solid way to “price” other assets because of its characteristics of being rare and stable in quantity – then the simplest way to profit from this trend is to wait for it to reverse - and when it turns around, sell gold and buy stocks. [Let me explain further.] Words: 431

The biggest danger to our society will be food prices and food costs....Productivity of grains has fallen to 1.2% per year which matches population growth exactly leaving society with no safety margin. [In addition,] there is a coming shortage of two fertilizers which occur exclusively in nature...so once the supply is gone, it’s gone forever - and this can only mean that commodity prices are going higher - much higher. Words: 585

George Soros’ hedge fund, Soros Fund Management LLC, states in its Nov. 14th 13-f filing that, among other major moves related to gold, the fund has added a $9 million call option position on the GDX which means that management of the fund believes that gold mining equities are extremely undervalued on a short term basis and that major money to be made over the next 6-12 months, via a sharp move higher in the GDX. Words: 405

Hedge fund manager Hugh Hendry has stated, "There is no rationale for owning gold mining equities. It is as close as you get to insanity. The risk premium goes up when the gold price goes up." Indeed, the notion that adding gold and other commodities to one's portfolio produces a higher expected return with lower risk failure has failed of late and can be illustrated through the following charts. Words: 808

We are undergoing a Paradigm Shift in the price trend of virtually all commodities – perhaps the most important economic event since the Industrial Revolution. [Let me explain why that is the case.] Words: 765