Fashions come and go in a flash in the investment world, but even when gold is a little beaten up, as it arguably has been in recent months as the gold price has come down by 15% or so from the highs of last August, there’s always at least a little simmering level of interest in junior gold miners. After all, the romantic notion that you can turn a barren patch of dirt into nice, shiny gold is endlessly appealing.
I know, I know, it’s a little less appealing now that the “get rich quick” dreams of the tech and crypto worlds have eclipsed the now-quaint notion of the dancing prospector. The idea of discovering a potential precious metals deposit and spending ten years building a mine to turn dirt and rock into gold is not as sexy right now as magically turning a digital work of art or sports video highlight reel into a million-dollar NFT, or turning a joke cryptocurrency experiment like Dogecoin into a $75 billion tulip bulb mania. But still, there’s something primal about turning a few acres of wilderness into a gold mine and reaping the rewards.
So in response to some reader questions, we’re taking a quick break from the hotsy-totsy tech teasers to look at a junior mining tease… it’s one that has circulated for a couple months, but is really going “hot and heavy” and generating more reader questions recently. Ready?
The pitch comes in from Luke Burgess for his Junior Mining Trader, which is a newish service from the Outsider Club folks, though it sort of slots in to the spot that was held by Nick Hodge and Gerardo Del Real with their Junior Mining Monthly, before they left and started up a new publisher and launched a new mining newsletter. Burgess has certainly been around for a while, he was penning teaser pitches for “#1 Gold Stock” ideas a decade ago, too, and was pitching stocks for other newsletters going back at least to 2007 (which is, I should note, the year the world began as far as Stock Gumshoe is concerned).
The service is apparently trading-focused, with stock ideas Burgess apparently plans to hold for a few days or a few months… and, as is typical, the more active trading newsletters want somewhat smaller audiences — you can’t tell 10,000 people to buy a junior gold stock all at once and expect them to get in anywhere near your recommended price, and one way they get that (and some huge profit margins for themselves) is by charging a premium price — so Junior Mining Trader is being sold for $1,999/yr — though to their credit, they do say they’ll give you a refund in the first 90 days, most higher-end newsletters don’t offer that.
OK, with that out of the way… what’s the stock? Let’s go through the clues…
First, the headline teaser info:
“We’re about to make a fortune off this gold discovery of the decade.
“This is one of the RICHEST gold discoveries of the last 50 years!
“The little firm that owns it is backed by TWO of mining’s most legendary billionaire investors.
“They could be sitting on the richest undeveloped gold mine in the whole world… worth BILLIONS of dollars.
“This gold stock could potentially shoot up 3,725% or higher.”
OK, so that’s actually probably enough in the way of clues… but we’ll just make sure with a few checks of some other tidbits in the pitch…
“Drilling samples indicate that this could be among the richest, highest-grade gold finds in all of the world, one that could be worth billions of dollars.
“It’s completely untapped.
“It’s 100% owned by a company that just recently went public.
“It’s armed with management that would be a ‘dream team’ for any mining company.
“And shares are trading for around $4 right now.”
And who are those “legends” who have backed this stock to date?
“One of them is a self-made MULTIBILLIONAIRE who made his fortune in gold. He runs an $11 billion global asset management firm focused on precious metals….
“The other investing legend is hailed as ‘the most esteemed gold executive in Vancouver…
“In fact, he’s damn near a billionaire himself.Are you getting our free Daily Update
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“He turned a tiny $50 million mining startup into one of the largest gold-producing companies on the planet, worth over $10 BILLION.