The Greatest Turnaround Stories are Worth Waiting For
Although gold could launch to new highs without a moment's notice, and the associated mining shares are drastically overdue for a monster rally, as of mid-November my bullish call for Brigus Gold appears unlikely to bear fruit during 2011.
For ths long-term oriented Fool, all that means is I / we have had more time to amass shares at bargain prices before the stock's inevitable advance.
Without ever setting out to do so, I have developed something of a focus on pinpointing mining stocks that are deeply out of favor with the market and/or persistently overlooked, and that are poised for meaningful breakout momentum on the basis of key operational enhancements or specific looming catalysts. It is not my sole focus within the sector, but it has emerged as a pattern within my various investment theses over time. Since I was drawn to value investing well before I became active in the resource sector, this focus makes perfect sense for me.
The unavoidable corrollary to this focus is a difficulty in pinpointing the precise timing of when the market will begin to recognize and price-in the ongoing and/or looming improvements. To those who may have been counting on a quick 12-month gain from Brigus for 2011, I am sorry the stock has not cooperated thus far. Thankfully, my top pick for 2011 (AuRico) has delivered in a very timely and convincing way on the turnaround story that I identified there, and additional top picks NXG, CDE, and AUY have trounced both the S&P 500 and the GDX.
To those like me who maintain a strictly long-term outlook on the sector, I trust this bout of pronounced weakness across multiple precious metals mining stocks in recent months has afforded a terrific opportunity to get into position on some of the more compelling turnaround stories in advance of the next major run to the upside. There again, I can't say precisely when that breakout for gold is coming, but rest assured it is coming all the same.
I wish each and every one of you the utmost success in your precious metal investments, and I thank you for continuing to make this online investment community the greatest place in the world for investors to confer with fellow investors when selecting their preferred vehicles in the resource sector.