Tips and Stock Picks from Louis James of Casey Research

A lot of interesting topics came up at last week’s Sprott Vancouver Natural Resource Symposium, but perhaps the most unusual presentation came from Louis James, chief metals and mining investment strategist at Casey Research. 

Titled “Stock Market Time Machine: Benefit When Market Conditions Turn Hindsight into Foresight,” his talk covered how investors can use volatility — a mining industry staple — to their advantage.

Explaining how it’s possible to do so, James said that while no investor can actually go back in time, volatility can provide the same effect. How? Well, if a mining stock takes a hit for no discernible reason, it’s essentially returning to an earlier price level. So, said James, when the market fluctuates, it’s important not to panic; instead, have a shopping list ready.

On the flip side, it’s also important to know when to cash out. Too often, investors understand the logic of buying low and selling high, but fail to follow through. Urging the audience not to fall into that trap, James spoke to the merits of taking a “Casey free ride” — once your investment has doubled, recover your initial investment.

For example, James pointed to Atac Resources (TSXV:ATC), whose share price tripled not long ago, allowing those who got in when it was lower to enjoy significant gains.

The big question, of course, is which company will do that next. While James didn’t make any promises, he did tell attendees some of the companies he feels are poised to do well. Here’s a list of 10 of them:

• James praised Pretivm Resources (TSX:PVG,NYSE:PVG) highly, saying it has “the richest deposit on earth.” The company’s share price reached nearly $18 back in 2012, but at close of day Friday was sitting at $7.55. 

• Dalradian Resources (TSX:DNA) has an advanced gold project in Northern Ireland, a stable mining jurisdiction, according to James.

• Exploration and development company Rubicon Minerals (TSX:RMX,NYSEMKT:RBY) is focused on its flagship Phoenix gold project in Ontario.

• Continental Gold’s (TSX:CNL) flagship Buritica project is located in one of the safer parts of Colombia, James said, noting that he’s visited the site and trusts the company.

• James spoke positively about Roxgold (TSXV:ROG), but suggested investors get their money off the table before the approaching election in Burkina Faso, which is home to the company’s Yaramoko exploration permit.

• Kaminak Gold (TSXV:KAM) has been getting a lot of positive attention lately, and with more drill results expected this quarter from the company’s Yukon-based Coffee gold project, that’s likely to continue.

• Pilot Gold (TSX:PLG) is “on to something substantial,” said James.

• Balmoral Resources (TSX:BAR) has delivered “terrific drill results,” according to James. The company is also notable for its dual focus. Though it’s a gold exploration and development company, its Grasset deposit includes nickel, which is currently a hot commodity.

• It’s not often you see something “so big and so high grade in copper,” said James of Reservoir Minerals’ (TSXV:RMC) Cukaru Peki discovery in Eastern Serbia.

• Though Rio Alto Mining (TSX:RIO,NYSE:RIOM) doesn’t have high-grade gold, it’s near surface and has high margins, James noted. The company is in the midst of completing a merger with Sulliden Gold (TSX:SUE,OTCQX:SDDDF).

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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article. 

Related reading: 

Rick Rule on Making the Best of the Bear Market

Mining is a Difficult Business: Adrian Day Weighs Investing in Major and Junior Gold Companies

Robert Friedland Bullish on Platinum and Copper