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« Summary of Inflation and Deflation the United States | Main | Silver: Correction Brings Opportunity »
Jun292009 Portfolio Update 30 June 2009

USD Chart 30 jun 09.JPG
Chart courtesy of Stockcharts

We mentioned in the last update that in the short term we could see an oversold dollar bounce back albeit slightly with a corresponding knock on effect on gold, this has now happened and the dollar did manage a short weak rally which capped the progress of both gold and silver. July and August could present us with a dip which should be used as an opportunity to acquire a few more of your favorite shares, as we still anticipate that both gold and silver prices will set new records before this year is out.

Here is a summary of the silver stocks we are currently invested in or following:

Hecla Mining Company (HL) – Initially we bought this stock for $5.27 - a quality silver stock which was going along nicely and then we thought Hecla was overbought, as it hadn’t corrected with other silver stocks, therefore we took profits on Hecla at $11.89, the stock price then dropped so we bought it back at $9.72, getting a 18% discount on our shares. On the 14th April we sold 50% of this stock for $11.79 in order to lock in some profits as we anticipated a fall. On the 18th June 2008 we re-purchased Hecla’s shares for $9.61. Hecla traded as low as $0.99 and closed yesterday at $2.79. Hopefully Hecla can continue to improve and eventually surpass its previous highs.

Pan American Silver Corporation (PAAS) – Initially we bought this stock for $18.00 and on the 23rd August we gave another BUY signal on PAAS when we said “We made a further purchase today at $24.10” giving us an average purchase price of $21.50. On January 31st, 2008 we sold about 50% of our shares for an average price of $36.65, locking in a profit of around 70.32%. On the 18th June 2008 we re-purchased PAAS shares for $31.06 and on 16 July 2008 we made another purchase at $36.53. PAAS has traded as low as $8.93 over the last year and was standing at $21.42 at our last update so some consolidation has taken place and PAAS closed at $18.55 yesterday.

Silver Wheaton Corp (SLW) – Originally bought for $9.41 and made another purchase on 15 July 2008 at $15.61 and a further purchase on 6 August 2008 at $11.43. SLW closed yesterday at $8.52, having traded close to $11.00.

Silver Standard Resources Incorporated (SSRI) Initially we bought this stock for $19.98 and on the 20th August we gave another BUY signal when we wrote “we think Silver Standard is at a good level to buy at the moment and we bought today at $28.99” giving us an average purchase price of $24.48. On January 31st, 2008 we reduced our exposure by selling around 50% of SSRI for an average price of $34.82 locking in a profit of 42.22%. SSRI dropped to $7.99 during in the sell off but recovered a little to trade at $24.00 last month and yesterday it closed at $19.16, having pulled back a little.

Eagle Plains Resources Limited (EPL) – We bought this stock for around $0.53, it has been down to $0.08 but closed at $0.215, at the last update, yesterday EPL closed at $0.24. We will continue to hold for now and keep a close eye on it.

Endeavour Silver Corp (EXK) – We initially bought Endeavour for $3.97 and on 7th December 2007 we bought more shares saying; “EXK is down from over $5.50 and as it has been beaten down so much we are signaling a BUY again on this stock and we made a further purchase bringing our average price to $4.10 per share as we doubled our position.” we secured EXK for $3.26 on the 2nd April 2008. This purchase being the largest we have ever made in EXK. Encouraging results helped this stock trade at $2.02 at the time of the last update. Yesterday Endeavour closed at $1.75.

Minco Silver Corp (MSV) - Bought for $2.80 as a speculative move, it later dropped to trade at $0.40, which hit us hard, however it has been showing signs of recovery during and during the last update it traded at $2.20 closing yesterday at $2.00. Again we will continue to hold and hope that it can continue to head north.

Traders Corner:

We have no positions open at the moment however we did suggest at the last update that some of these stocks had run a little ahead of themselves and the occasional PUT might be worthy of consideration, however, we decided not to partake, please let us know if you took the plunge!

We remain in a patient observation mood during this world full of financial turmoil, the outcome of which we expect to be the continuing demise of the dollar and an ever-increasing recognition of both silver and gold as the only place to be. Apart from precious metals we do not hold any other stocks as we are believe that this sector is about to boom.

Have a sparkling week.

Any thoughts – then fire them in.

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