John Feneck: 5 Factors to Consider When Buying Junior Mining Stocks

John Feneck, portfolio manager and consultant at Feneck Consulting, sat down the Investing News Network for a strategy-focused discussion outlining what criteria his firm uses when looking at juniors.

Feneck laid out five points investors should consider when evaluating exploration companies in order of importance: management, project, jurisdiction, share structure and management ownership.

On the topic of jurisdiction, Feneck said he is paying close attention to several silver companies in Mexico that have open-pit projects, but are awaiting permits. Those include Silver Tiger Metals (TSXV:SLVR,OTCQX:SLVTF), Sonoro Gold (TSXV:SGO,OTCQB:SMOFF) and Discovery Silver (TSXV:DSV,OTCQX:DSVSF).

“All three of those are waiting on the new person in charge, (President Claudia) Sheinbaum, to give them direction in October as to how things are going to roll going forward,” Feneck explained during the conversation.

"So the stock prices of these companies have been very depressed as a result of investors waiting."

The conversation later turned to knowing when to enter a stock and how much to invest in new plays.

“My process is different than just about everyone that I've talked to in that we admit that we can't get it correct all the time on the entry point … Therefore, we buy (into a given stock) six to 10 times over a given year, usually,” he said.

These purchases are typically in the US$5,000 range as opposed to US$50,000 because Feneck doesn’t want to move the stock too much upon entry and wants those that follow him to be able to enter as well.

Watch the interview above for more from Feneck, including other stock picks and how he decides when to sell.

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Interview by Charlotte McLeod. Article by Georgia Williams.

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

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

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.