Mining Expert's Best Bets on Silver

02/07/2017 10:00 am EST

Focus: STOCKS

Brien Lundin

President, Jefferson Financial, Inc.

The rally in equities had stolen much of the speculative demand from gold, and any pullback promised to send investors running back into gold. This is happening at this very moment, explains Brien Lundin, editor of Gold Newsletter.

Coincidental to all of this, we’ll soon see the end of two events -- the Chinese New_Year and the currency illiquidity crisis in India -- that have severely depressed physical gold demand.

In fact, the gains we’ve seen so far in gold have come without the aid of the world’s two most important sources of physical gold demand. If these markets return and join with Western speculative demand, then we could see fireworks in gold.

I_f we get any kind of a rally in gold going forward, we can also expect silver to outperform. So we would do well to be positioned in high-quality silver stocks going forward. Two of our portfolio holdings deserve mention:

Great Panther Silver (GPL) is one of our longest-standing silver recommendations, with a history of greatly rewarding our readers in a bullish silver environment.

The company is about to take a major step forward with its purchase of the Coricancha Mine in Peru. This addition could boost its annual production by over 70%, beginning next years, and the market has yet to factor this into its projections. This makes Great Panther a strong buy.

Silvercorp Metals (Toronto: SVM) is also in the running for one of our oldest silver recommendations, and it has also spun out life-changing gains for our readers during silver rallies. It may be ready to do so once again.

The company just announced that 2016 exploration at its LMW mine in the Ying Mining District in China have outlined significant new high-grade vein structures.

Simply put, these new veins show the typical high-grades and strike extent that have generated tremendous cash flows for Silvercorp in past silver rallies ... and even when silver price s_have been depressed.

As a result, the company is cash rich and, given its recent news flow, rededicated toward getting the market’s attention. In the past, this has translated into quite exceptional share price gains. In short, Silvercorp is a buy.

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