Bill Powers explains five reasons why junior mining investors fail in this MSE episode. He shares numerous insights gained by firsthand experience over the past eight years of focused investing in junior resources stocks. Learn and heed all five warnings, if you have not already. Number four frequently blindsides newbies.
0:00 Introduction
2:19 Failure Reason #1
8:12 Failure Reason #2
13:14 Failure Reason #3
18:39 Failure Reason #4
22:12 Failure Reason #5
Video mentioned at 7:13 “Discerning Mining Promoter Claims”: https://www.youtube.com/watch?v=Cd51EhQisEs
Video mentioned at 8:47 “Discerning Bias”: https://www.youtube.com/watch?v=t6JZRCwVQcI
Video mentioned at 19:37 “Bre-X Scam”: https://www.youtube.com/watch?v=iovp5nDy5yk
Video mentioned at 19:48 “Mining Scams”: https://www.youtube.com/watch?v=uDqxhinP138
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#miningstocks #smallcapstocks #resourceinvesting
37 Comments
Thank you!
Appreciate the wisdom!
It's hard, Bill. I spend most of my days reading thru Presentations, Financial Statements, play back recorded talks given by CEOs, listen to what other analysts think. Maintain my own spreadsheet of 100 companies and multiple metrics. I've a brokerage account that is dedicated to these Jr resource stocks. Success has been hit-or-miss and plenty of underwater positions. If you'd told me in Sept that gold was going to run from 1820 to 2000 in October alone, would've loaded the boat. And that would not have helped! Most stayed flat or even went lower. The other problem is liquidity. There are a few NYSE-listed companies but most are either OTC or Pink sheets. So when you want out, or if there's a stampede to get out, you will not get your price. And so it goes…
Thanks so much Bill!! Found your channel just recently and have been soaking it up! Like so many others, I've lost way too much before I re-hooked up with a longtime friend who has been trading the Venture Exchange for more than 35 years having started as a Board Runner on Vancouver's Venture Exchange. His biggest lesson was teaching me how to take profits. My method was waiting for the grand slam and like you said, after seeing a stock appreciate 10 or 20 fold, we want more (greed), don't take profits and end back at break-even or sometimes under water.
I've learned even more since discovering your channel so thanks once again for helping and pushing us to do our own due diligence.
It is so crucial, as is timing and experience. Thanks for sharing yours with us. Time to subscribe.
Talon Metals nickel. In for a penny, in for a pound. They're building a processing plant in Mercer ND… It's a money printing machine.. never ending gigawatts for the transition.
You only fail when you sell. Never sell.
Now Joe Manchin will be running for president. The DOE and DOD are backing Talon. Tesla has an agreement. Hmm. Looks like a green light. 🚦
Thanks for all you do for us, BIll !
Thanks Bill, awesome content, wish I'd seen it 2 years ago ! 😉👍🏻💛
Listening to the advice of promoters is usually not a good strategy
What a ride.
JR mining investors fail because the jr mining companies find no minerals, dilute shares into the billions, because other jr mining investors dump their shares. expect 98% of jr mining companies to fail and make no money.
Hey there😊 what is that mysterious company name that can potentially do 30x the investment? I’d love to speculate on that! Thank You!
I was wary about investing in general because I knew that there are games being played by the insiders but am not able to understand or get some visibility in them. I think this is crucial for any investor and the example of the investment bank was one such incident. This info is very difficult for a amateur investor to discover, let alone understand. Please keep making more videos on such topics
Other than this channel, which is simply the best for education, I like listening to Crescat Capital's channel. I generally won't touch a stock until I've heard Dr. Quinton Hennigh talk about it several times. …and you can learn a little about geology at the same time!
Tavi Costa's weekly review of macro is amazing as well. I've been slowly accumulating positions in 16 juniors over the last few years. Even with such great knowledge from Crescat and you, Bill. I still feel it's risky! Risky but exciting. I wouldn't have it any other way. 😎
Yikes Bill!
Don't hold back on us, just lay it out there. Very sobering, but needed, information.
In 60 years of investing in junior mining stocks, I have had only two ten baggers. Two X and three X are more common. Five X gains are dreams. The 40 percent loss rate is true.
In my comment on success rate over 60 years, I need to explain my family background. My father was a gold and silver bullion dealer and my stepfather was the President of International Copper Research Association. They taught me almost all I know. So, I am from an insider background and still only have a better than average success history.
My point is to be very wary because the governments in mining countries are capricious and often do not understand the risks in mining. The management of mining companies often are not knowledgeable of project financing. Most projects do not have economical deposits and use smoke and mirrors to promote the deposit.
Most lose money in my experience. Usually use my jr co’s for tax loss. 50%+ turn into 💩. A couple names here and there do great over a period of time. Usually a long period of time, 5+ yrs.
Gotta bet pretty big to win big. Lastly, it’s better to own a lot of shares of a few companies vs a few shares of a lot of companies. Thx Bill. Always useful information 👍🏼
You give good advice… but sometimes an opportunity pops up which just makes so much sense to throw heaps of money at it. I bought a small cap gold miner back In March with a large amount of my net worth.
Had a market cap of 90 million, 50 million cash in the bank and 250 million processing mill + 150 million in gold assets. It’s now expanded its resource but the risk reward always made sense. I’ve 4 bagged my investment and I think there is more to come
One – if not the – most important educating Video i have ever watched. I wish I was that clever 4 years ago. Bill, literally put all the learnings together. Thank you
Thanks for yet another excellent video
thank's Bill !
In my opinion, it is a waste of time for the average retail investor to buy junior miners. Even the so called "experts" have a terrible track record. With a competently corrupted financial market that is manipulated and skewed against metals, you are almost guaranteed losses. You are better off buying mid tier or higher on the mining food chain. I have chosen to put most of my investments in mid tier miners with producing mines. A stock like EXK, AG, MAG, FSM could easily see 4,5,6 fold when the FED's Ponzi starts to collapse and metals rise. They do NOT have the risk of a junior. They are unlikely to go bankrupt. If you need more "alpha" than that, you may be a degenerate gambler, not an investor. END THE FED. Gold IS Money.
Listen folks, in normal circumstances he's right that junior mining companies do often fail, due to incompetent Mgmt teams and especially the forced ESG garbage that drains valuable resources away from the primary goal of the bottom line. However we are in the Early stages of a 70's repeat, where juniors exploded 15-30k% because when the FOMO crowd rushes in, as Gold explodes past $3k, 80% of that crowd won't have a basic understanding of the precious metals mining fundamentals and won't care other than the fact it's Gold & Silver they are mining…It's basic human nature that has happened throughout mankind's history…When there is a Gold Rush, everyone wants a part of the potential riches. The only person who gets rich in a Gold Rush, is the guy who sells the picks, axes, and shovels…Lion One Metals, and Discovery Silver are my two best bets Junior companies that have great potential of serious gains of 5-10k% gains when Gold-Silver explodes in the next 3-5 yrs…
1st mistake is buying junior miners
Always thought a gambler was the same as a speculator, the TSX-V is at his lowest since the last 20 years, funds are selling their risky stocks, shorting these stocks when they're going down is killing the juniors stocks, sad !!!
Any update on trillion soon?
Once again, thanks for sharing your learnings, this was a great educational video, Bill. Cheers!
After hearing all this, ETFs probably looks like the best solution for most investors 😀
Step one: buying junior mining ⛏️ stocks 😂
"A PM Junior/Explorer is a "hole in the ground with a liar next to it" Mark Twain!!! should've learned that lesson in 2020-21-22
"I went broke slowly then all at once" Im at stage about to lose it all at once ?!!!
I hate that he brought here all kinda liars that wrote themselves fat checks while were going broke!!!
stick to SILJ SGDM SGDMJ and don't listen to any Aurcana Neumeyers etc and remember folks Markets can stay irrational longer than You can stay solvable!!
good luck to newbies I'm out of money doubled down too many times!!!!
I consider myself lucky being under water 'only' 30% on my junior pm portfolio. Truth is you can never be 100% sure how a promising story is going to play out. Apart from macro and company specific characteristics, there's also a great deal of luck involved but hardly anybody dares to mention that.
Because junior mining stocks beat you down like
Nothing else! You have to have the patience of a monk and nerves of steel.
Juniors used to run up with Gold or decent drill numbers. Not so much anymore.
No one has a chance against govt authorized (via brokerage houses and banks) naked predatory short selling to kill the mining industry in the name of esg. Not to mention underhanded politacal influence via various departments of govt such as permitting safety regs etc. Donkin Coal is a perfect example. Shut down again for no reason other than politically influenced delays.
Thank you Bill.
It’s a tough environment for small and microcaps at the moment.
One should focus on those who don’t overdo their debt levels. The high interests rates will bury them.
Chris Harvey, the Wells Fargo strategist said today on CNBC, that value stocks and small caps simply won’t work in this environment but that is true for those who have very high debt levels
Thanks for all the great content, your time and effort that you bring to us all. It is highly appreciated.
Very tough business, high inflation & gold price suppression doesn't help
Excellent advice Bill. Reality setting in is often very hard to see for many.