Markets move in cycles; longtime investors have seen the ongoing struggle between various markets and sectors throughout history. Sometimes one market tips too far in one direction and we see investors piling in when they ought to be getting out.
Since the Great Recession and the so-called recovery, the major stock market indexes have topped out and now it’s time for precious metals and miners to stage a comeback of epic proportions.
For real talk on the imminent rebalancing of the markets, Future Money Trends looks to the experience and expertise of entrepreneur and market expert Amir Adnani. Mr. Adnani is the Founder and Chairman of GoldMining Inc. (TSX: GOLD, OTCQX: GLDLF), located on the web at GoldMining.com, as well as the CEO, President, and Director of Uranium Energy Corp. (NYSE: UEC), located at UraniumEnergy.com.
It’s easy to see why so many investors seek out the expertise of Amir Adnani. Fortune magazine has placed Amir on their prestigious list of “40 Under 40, Ones to Watch” list of North American executives, and he has been celebrated by Casey Research as one of the sector’s leading entrepreneurs through a list known as “Casey’s NexTen.”
Furthermore, Amir Adnani is a nominee for Ernst & Young’s “Entrepreneur of the Year” distinction, and he is a member of Casey Research’s 10-Bagger Club, which is exclusive to resource entrepreneurs who have rewarded their subscribers with realized gains of 1,000% or more. In addition to that, Mr. Adnani has been identified as one of “Mining’s Future Leaders” by Mining Journal, a global industry publication based in the United Kingdom.
The Future Money Trends team actually had a chance to speak with Amir and he explained that now is a great time to move out of traditional Dow Jones-type stocks and into carefully selected gold miners.
Amir describes commodities are a hard-asset business and states that gold prices are cyclical in nature, explaining that gold is forming a secular bottom right now. As we are observing a historic turning of the tide in monetary policy, the price of gold and other metals should find equilibrium at or around the marginal cost of production.
When the stocks-to-gold ratio becomes lopsided and equities euphoria takes hold, it’s time to rebalance and reconsider your portfolio holdings. The following graph makes it clear that the markets are in a precarious situation, not unlike what we saw leading up to the markets of 2000 and 2008:
Courtesy of Wilshire Associates/FRED
Mr. Adnani is 100% right in his assessment of the current market scenario, and he has history on his side. The Fed began hiking interest rates since late 2015, as well as reducing the size of its balance sheet in the fourth quarter of 2017 (a process known as quantitative tightening). Looking back at historical cycles, we observe that rising interest rate environments are positive for gold prices – market developments in recent years are testifying to this fact.
Like Amir, Future Money Trends appreciates the cyclicality in commodities and relishes the opportunity to take advantage of the temporary dislocation between prices in gold mining stocks and what it actually costs to drill and develop a gold project right now.
According to Amir Adnani, what we’re witnessing now is a situation in which gold prices are sitting at a ten-year low, but Amir is showing no signs of fear.
Clearly, the market doesn’t recognize the full value of assets in the metals and miners sector during bear cycles like we’re seeing at the moment, but sophisticated investors are only seeing this as an opportunity to build real wealth.
Mr. Adnani and I both expect normalization to occur soon as the price of gold inevitably reverts back to the marginal cost of production; history has demonstrated this over and over. The gold-to-stocks ratio that is clearly out of whack and is poised for mean reversion: we’re seeing the Dow Jones at extremely overbought levels, and according to Amir Adnani, the metals and miners market is priced at extreme levels to the downside, far below what is justified by the marginal cost of production.
That’s why it is imperative for investors to lighten up on traditional market-tracking funds and get into the precious metals and miners stocks that will benefit the most when the massive mean reversion takes place.
Future Money Trends is preparing for big market shifts, and we’re taking Amir Adnani’s sage advice and putting his ideas into action right now. If you’re not allocating capital into a select group of metals and miners companies, you’ll only wish you had gotten in early, when prices were low.
One great way to prepare for the coming market moves is by taking a long position in GoldMining Inc. (TSX: GOLD, OTCQX: GLDLF). This is a firm with a strong leadership team, a broad shareholder base with enhanced liquidity (insider ownership of 25%), and an impressive portfolio of highly prospective gold and copper projects.
Plus, GoldMining Inc.’s joint venture with Orano has provided the company with the largest land base in the Western Athabasca Basin – a clear competitive advantage in the mining space.
GoldMining Inc.’s seven acquisitions in five years points to a fast-growing firm that’s set to break out during the current gold price bottoming process. Indeed, this firm excels at handpicking the best acquisitions when prices are super-low:
Courtesy of GoldMining Inc. Investor Presentation
While most retail investors are piling into positions at the peak of the bull market, GoldMining Inc. is buying low and building value for shareholders. It’s a firm that’s moving up and making big strides in the markets, as GoldMining Inc.’s stock shares recently commenced trading on the TSX effective June 19, 2018. As Adir Adnani states, “The TSX is a significant marketplace for international capital and a premier stock exchange for resource companies. This new listing will elevate the visibility of the company, attract new interest and improve access to capital markets.”
Future Money Trends also recommends a position in Uranium Energy Corp. (NYSE:UEC), a U.S.-based uranium mining and exploration company. This firm controls one of the largest databases of historic uranium exploration and development in the country. Using this knowledge base, Uranium Energy Corp. has acquired and is advancing exploration properties of merit throughout the southwestern United States.
Profiting from the coming boom in the metals and mining space will be easy for UEC shareholders. Uranium Energy Corp. has an absolute competitive advantage with its diversified asset portfolio, the crown jewel of which is the Hobson processing plant; this facility has an astounding production capacity of 2 million pounds of uranium per year. All told, Uranium Energy Corp.’s holdings comprise tens of millions of pounds of metal production:
Courtesy of Uranium Energy Corp. Investor Presentation
And this firm is still expanding, as we recently discovered in Uranium Energy Corp.’s announcement that they have completed their purchase agreement with Uranerz Energy Corporation to acquire 100% of their advanced-stage North Reno Creek ISR (in-situ recovery) project.
This notable acquisition adds further scale to an already large, fully permitted and construction-ready project. Regarding this, Amir Adnani stated: “We are very pleased to complete this highly synergistic acquisition integrating North Reno into our broader Reno Creek project area.
This further cements our position in controlling one of the largest, fully permitted and 100% un-hedged low-cost ISR portfolios in the United States. This acquisition also comes at a time when international trade and geopolitical developments underscore the importance of domestic uranium supplies in support of American energy security.”
GoldMining Inc. and Uranium Energy Corp. are ideal holdings for any investor, and many world-renowned market experts agree: Rick Rule, Marin Katusa and Doug Casey are big investors in these companies. Future Money Trends will continue to monitor the progress of these leading-edge firms as they continue to reward shareholders with generous returns.
To help you learn more about how to profit from the coming bull market in precious metals, Future Money Trends has recently published our Quintessential Gold and Silver Stock Playbook and our Guide to Under-the-Rader, Highly Leveraged Gold Projects – you can download all of these full exclusive reports right now.
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