Hey Man, You Into Metal?

My man, JP, has long hair. He sometimes gets asked if he’s into metal or if he caught the latest metal show. Of course, this is regarding heavy metal music, not metallurgy or actual metals. Our friends Jill and Keith, however, are heavy into metal – metal mining, that is. Jill is the marketing VP and Keith is the founder and CEO-Pres of First Majestic Silver Corp., one of the world’s leading silver producers.

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Me and Jill

These lovely Vancouver friends of ours invited us to attend the annual Senior Silver Reception on the second night of the 2016 PDAC Convention this week in Toronto. This convention, by the way, is the largest convention for mining prospectors and developers in the world. It was an interesting reception on Monday night at Ripley’s Aquarium. JP and I had a great time drinking from the limitless supply of classy bevvies and listening in on conversations between investors and the corporate heads of Canada’s biggest mining companies. It is always fascinating to learn about the different investment and business strategies out there. While we only attended the reception, we vowed to attend next year’s mining convention–not just to eavesdrop, but also to partake in these conversations.

Precious metals weren’t only a hot topic because of this prestigious silver reception; the metals have made a notable comeback in the last couple of months. Oil made a bit of a recovery so far this month, which helped bring the loonie back up, but this recovery could be short-lived. Many analysts and investors are still pessimistic about this big sector. If oil goes down again, this could negatively impact the markets and the loonie. Also, if China, one of the world’s largest trading partners, slows down in economic activity, this will sink things down even further globally. Generally, precious metals become more valuable in times of economic uncertainty. As your currency is likely to fall along with the economy, tangible assets such as precious metals are good to have in your portfolio to hedge against potential economic extremes. This week, the global markets finished positive. I am, however, guardedly keeping my eye on oil and considering my next couple of moves.

Full disclosure: I am not being paid by Jill or Keith to write this. In fact, I am kicking myself for not buying First Majestic’s stock back in January/February (it has since more than doubled in price). For someone who actively trades stocks, I have nothing but a long list of sad excuses to explain why I didn’t get in then. I’m a little late to the metal party as the metals have been going up consistently for a while. In the next month or two, JP and I will be looking for metal prices to pull back and come down a bit – which is when we’ll take our next opportunity to get into metal, man.