Meanwhile, back at the credit crisis...

[Guest]

Re: Meanwhile, back at the credit crisis...

People here suggesting it's an either/or decision, or that holding one over the other is "better" are trying to compare apples and oranges. The two investments are not the same thing.

Understood and agreed.

Now please PM me your entire portfolio of carefully researched juniors, complete with symbols, current buy prices and stop losses you've set, if any. Don't forget to include some research data on each pick! That would be splendid. "To give freely is it's own reward" GRG55. Your character will be burnished, you'll be praised to the heavens, and you'll just generally become an ever more decent chap. Oh, and lots of good karma will come your way as a well, (so cough them up!) etc.

[metalman]

Re: Meanwhile, back at the credit crisis...

Having said that, the reason to consider owning resource companies instead of [just] the commodity alone is that the very best of them, with real reserves in the ground, in politically secure areas of the world represent a long-dated option on that commodity.

great point. but without meeting the mgt team and board and getting to know them, how do you know if the company is just a tax shelter/money laundering scheme for management and the board or a legit business with prospects?

[GRG55]

Re: Meanwhile, back at the credit crisis...

great point. but without meeting the mgt team and board and getting to know them, how do you know if the company is just a tax shelter/money laundering scheme for management and the board or a legit business with prospects?

That is a great question, and frankly a real challenge. You really have to do your homework and it is hard work if you want to chase juniors. EVen then it's still best to hold a basket of the best juniors you can find in each separate sector you play.

Some external indicators can offer clues. One worth watching is how much dilution is going on from the issuance of stock options to insiders, compared with insiders buying their own stock (with their own money, not compensation stock grants). Right now with junior valutions in the toilet, the really serious management teams have members buying their own companies on the cheap. The crappy ones are just rewriting stock options at ever lower strike prices.

Other indicator is how those managers acted in past ventures. Junior oil and junior mining is actually a pretty small business worldwide, and you will see the really smart money build companies during the bad times and sell out during the good times, take a year or two off to work on the golf game, and then often substantially the same team will come back in and start again after the cycle turns negative temporarily.

Third, look for the financier. Some prime financiers have a tremendous track record of building company after company. They are a way to find the good management teams. Often a previously successful team will get its seed funding for their next venture from the same financier(s) over and over again. These folks are never written about in Fortune or talked about on bubblevision like Kerkorian or Ichan. They are generally local to the scene (Houston, Vancouver, Calgary, etc) and you have to read the local business mags or papers (often the charity event columns) to hear anything about them. Follow their money.

[metalman]

Re: Meanwhile, back at the credit crisis...

That is a great question, and frankly a real challenge. You really have to do your homework and it is hard work if you want to chase juniors. EVen then it's still best to hold a basket of the best juniors you can find in each separate sector you play.

Some external indicators can offer clues. One worth watching is how much dilution is going on from the issuance of stock options to insiders, compared with insiders buying their own stock (with their own money, not compensation stock grants). Right now with junior valutions in the toilet, the really serious management teams have members buying their own companies on the cheap. The crappy ones are just rewriting stock options at ever lower strike prices.

Other indicator is how those managers acted in past ventures. Junior oil and junior mining is actually a pretty small business worldwide, and you will see the really smart money build companies during the bad times and sell out during the good times, take a year or two off to work on the golf game, and then often substantially the same team will come back in and start again after the cycle turns negative temporarily.

Third, look for the financier. Some prime financiers have a tremendous track record of building company after company. They are a way to find the good management teams. Often a previously successful team will get its seed funding for their next venture from the same financier(s) over and over again. These folks are never written about in Fortune or talked about on bubblevision like Kerkorian or Ichan. They are generally local to the scene (Houston, Vancouver, Calgary, etc) and you have to read the local business mags or papers (often the charity event columns) to hear anything about them. Follow their money.

cool. have you actually done all of this and picked a few, i said hoping to draft from my fellow ituliper's hard work