Mining stocks are one of the best ways to hedge bets on economic growth. As we’ve seen historically, there is a high correlation between economic progress and the growth of mining stocks. Usually, investors tend to focus on gold stocks as they are some of the most forward-facing mining stocks to watch. But, in the past few months, the emphasis has been on silver. From December of last year until now, gold prices have shot up by around 30%. This may seem like a lot until we see that silver prices have climbed more than 50% in the same period.
Now, this is not to say that gold is not a good investment because that simply isn’t true. Rather, investors should always be looking to diversify into other asset classes such as silver. Silver has several benefits for investors to consider. For one, silver is much cheaper than gold and therefore can be accessible to all types of investors. This means that both institutional and retail investors can take part in investing in silver stocks. In addition, we have seen that gold and silver have a high correlation to one another, making them a great pair for investors to consider.Mining Stocks to Watch:
- Walcott Resources Ltd. (OTC : WALRF Stock Report) (CSE : WAL)
- Jaguar Mining Inc. (OTC : JAGGF Stock Report) (TSX : JAG)
- Agnico Eagle Mines Ltd. (AEM Stock Report)
One of the major benefits of silver, that gold does not offer, is that silver can bounce up during both recessions and recovery. On one hand, people tend to pour money into precious metals when economic recessions occur. On the other hand, investors also tend to invest in metals like silver when economies begin to recover.
In addition to this, many investors have stated that silver may be underpriced while gold is the opposite. Again, both gold and silver have value to investors, but there are, without a doubt, upsides and downsides to both. With that in mind, let’s take a look at three mining stocks that are “breaking ground” in the industry.Mining Stocks to Watch #1: Walcott Resources Ltd.
Walcott Resources Ltd. is taking the silver mining industry head-on with its approach. Although the company has remained relatively under the radar, there’s nothing under the radar about what it has been working on. Walcott Resources has taken advantage of some of the largest silver deposits in the world. According to a report done by Statista, the largest silver reserves in the world lie in Peru, Poland, and Australia. In Australia, Walcott Resources has taken the market head-on with its Tyr Project. This project, based in New South Whales, is the company’s primary silver asset. The company has just completed the acquisition of a controlling interest in this and other silver projects in the area.
The company recently announced that it had identified high grade zinc-lead-tin mineralization which is a good sign for silver mining. On the conservative side, the company estimates that high-grade surface mineral occurrences have been found containing up to 4,710 grams per ton of silver. If these numbers seem a bit confusing, let’s put them in some context. In Peru, the Uchicchacua Mine owned by Buenaventura, is considered to be the highest grade silver mine in the world. Despite this classification, this mine only holds reserve grades of 445 grams per ton of silver.
Right now, the Tyr Project is parsed out into two mines. This includes the Torny Underground Mine and the Burra Silver Mine. Both of these mines were historically operational around 90 years ago, and each has a wide breadth of information on what lies beneath the surface. In addition, the historical data should help to greatly expedite modeling for the NI-43 101 compliant resources.
With all of its opportunities considered, the company also has an uncompromising management team that brings all of it together. Marshall Farris, CEO and Director of the company has more than 24 years of experience in capital development and major corporate operations. His expertise has helped to lead Walcott Resources to where it is in the present day.Mining Stocks to Watch #2: Jaguar Mining Inc.
Jaguar Mining Inc. is a Canadian junior mining company focused on gold and other precious metals. The company states that it engages in both the development and exploration of its properties. In Brazil, Jaguar Mining holds claim to two major gold mining complexes that span more than 102,000 hectares.
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Its mines are primarily located in what is known as the Iron Quadrangle. This is a distinct area of Brazil that is known to contain a great deal of gold deposits. Recently, Jaguar Mining announced its production results for the third quarter of this year. The company stated that it has seen large improvements over its previous quarters at several key mines. This includes the Pilar Gold Mine and the Tumalina Gold Mine.
CEO of Jaguar Mining, Vern Baker stated that “we continue to see steady progress toward our goal of sustainable production of 25,000 ounces a quarter. Pilar has demonstrated strong performance with its second consecutive quarter with over 13,000 ounces of gold produced. Turmalina made a step forward in its quarterly production with 10,300 gold ounces produced, its highest production quarter in three years. Overall, gold production increased 25% in the third quarter compared to the same quarter in 2019.”
As we can see, Jaguar Mining is a gold mining stock that is in an advantageous position for future growth. Meanwhile, shares have also climbed more than 180% year-to-date.Mining Stocks to Watch #3: Agnico Eagle Mines Ltd.
Agnico Eagle Mines Ltd. is another Canadian gold mining company that has been in operation since 1957. The company is considered to be a senior gold stock as it is one of the largest in the industry by market cap. Agnico Eagle reports that it has several mines around the world. This includes operations in Finland, Mexico, and Canada. In addition, the company is working on the exploration of mines in the U.S., Columbia, and Sweden. For the past 37 years, AEM stock has been able to deliver dividends to its investors. One of the main reasons that investors like AEM stock is that the company has one of the largest exposures to the price of gold of any gold stock.
Recently, the company announced a major investment in Maple Gold Mines Ltd. This deal, worth around 25.8 million shares of Maple Gold Mines, could yield a lot of future growth for both companies. In addition, the company announced two weeks ago that it had entered into a joint venture in Columbia with Newmont Corporation (NEM Stock Report). The goal with this 50-50 joint venture is to explore the renowned Anza project as well as the exploration of other gold mines in Columbia.
The senior vice president of Agnico Eagle, Guy Gosselin stated that “Agnico Eagle has been actively looking in Columbia for some time, and this low-cost entry is consistent with our exploration strategy.” The large amount of exploration being undertaken by Agnico Eagle, shows just how much potential the company has in the long term. Because of this, it remains one of the leading mining stocks to watch for the future.