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« Silver Wheaton Corporation: Purchased a few Call Options Today | Main | Endeavour Silver Corporation: On the Acquisition Trail »
Wednesday
Feb102010

Silver Wheaton Corporation: Buy this Dip

SLW Chart 11 Feb 2010.JPG


Silver Wheaton Corporation (SLW) has held up pretty well during the recent sell off and we see the 200dma, currently standing at $12.00 as a good support level. The RSI is creeping back the STO is heading north with the MACD looking to form a crossover shortly.

As our largest holding we have been pleased with its progress and would be buyers at this point if we did not already hold so much of the stock. I guess that reasoning should not put us off be we are wary of putting a lot of eggs in one basket. Its single minded enough that we only invest in the precious metals sector without adopting a snipers single shot approach to investing in this tiny sector.

However, we may be tempted to venture out via an options trade once the topography suits us. We need to see the Euro strengthen and appear in a more attractive light than the Dollar, sending the dollar south and re-igniting the demand for gold and silver. We are still looking for a serious recovery in silver prices between now and May so we will be looking at the June series with a strike just out of the money, SLW is $14.38 today so we will probably plumb a strike price of $15.00 or $16.00.

SLW Options Chart 11 February 2010.JPG

A bit more about Silver Wheaton taken from their web site:



Established in 2004, Silver Wheaton has quickly positioned itself as the largest silver streaming company in the world.  The company has entered into seventeen agreements where, in exchange for an upfront payment, it has the right to purchase all or a portion of the silver production, at a low fixed cost, from high-quality mines located in politically stable regions. Forecast 2009 production is 16 million ounces of silver and 17,000 ounces of gold, for total production of 17 million silver equivalent ounces.  By 2013, annual production is anticipated to more than double to approximately 39 million ounces of silver and 20,000 ounces of gold, for total production of approximately 40 million silver equivalent ounces.  No ongoing capital expenditures are required to generate this growth and Silver Wheaton does not sell forward its silver sales.


Silver Wheaton Corporation trades on the New York Stock Exchange and the Toronto Stock Exchange under the symbol of SLW and is currently trading at $14.38.

The Company has a market capitalization of $4.91 billion, with 341.28 million shares outstanding, a 52 week trading range of $5.66 to $17.80 with an average volume of 6-7 million shares traded.

Look out for Silver Wheaton's full results due out on 4th March 2010.

All the best.

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Reader Comments (1)

Pardon me if I sound naif, but did SLW have a nice pop at its last earnings news release. I wear a crash helmet and knees pads just to walk to the mail box. So pardon my caution. :D

February 11, 2010 | Unregistered CommenterDavid

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