Club Mulgoa

Saturday, November 12, 2011

Which gold stocks to buy?

http://www.usfunds.com/investor-resources/frank-talk/Gold/Which-Gold-Miners-Have-Largest-Upside-6814/

http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=139035&sn=Detail&pid=31

All these links are based on US stocks. But the same applies to Oz. When POG rushed to USD$1900 per oz, I couldn't resist buying producers whose share price has fallen, especially when you consider AUD had tumbled from USD1.08 to near parity. Not all the stocks have risen and during the recent correction, a few had been punished for no good reason other than sentiment and market craziness.

Gold cannot be printed. Gold is expensive to produce. Large gold deposits are not easy to find or mine. South African mines are very deep and less productive now, so China has overtaken it as the main gold producer for a while now. The Chinese and Indian middle classes and some central banks are starting to hoard gold again. Recently there has been a floor for POG.

Some of my gold stocks have only just started producing so the profit figures will take a while to be broadcasted. Hopefully, in time, the disparity between the rise of bullion price and the share price of gold producer will vaporize. Certainly a good explorer is worth considering. I topped up AMX recently and I scored a sweet rise :-)

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