Ralph Aldis joined U.S. Global Investors in 2001; he is the portfolio manager for World Precious Minerals Fund (UNWPX) and the Gold and Precious Metals Fund (USERX) and a contributing editor to US Global's Investor Alert.
Gold was up 20.41 percent year-to-date as of last week — trading at $1,552 an ounce. Sound impressive? Miners were up more than double that at 48.75% over the same period, as measured by the FTSE Gold Mines Index.
Since miners’ margins are highly leveraged to the price of the metal they produce, these companies have historically appreciated alongside gold.
Here are three of my top mining picks right now as we approach the last quarter of the year.
Wheaton Precious Metals (WPM)
I continue to be bullish on Wheaton as it’s undervalued compared to its precious metal royalty and streaming peers. But now that silver is rallying, along with other precious metals, I believe the company has even more potential to the upside due to its strong exposure to the metal.
In 2018, Wheaton had 43 percent of its revenue come from silver streams, which is far more leverage to the metal than its peers. The company was up 93 percent over the last 12 months and up 57 percent YTD as of yesterday.
Tristar Gold (Toronto: TSG)
About a month ago Tristar Gold completed an $8 million agreement with Royal Gold that will keep its flagship project in Brazil funded for the next two years.
Securing funding is the most critical factor in the junior mining space. Tristar will use the capital to complete a prefeasibility study and to advance permitting activities. Despite recent political turmoil, Brazil is still good for operating and remains mining friendly.
Cardinal Resources (Toronto: CDV)
Cardinal operates in Ghana and has a “shovel ready” 5.1 million ounce mineral ore reserve within its Namdini project. Last week, the company announced new additions to its team including adding a director, Trevor Schultz, who has over 45 years’ experience building mines with AngloGold Ashanti (AU) and Centamin Plc (Toronto: CEE).
Ghana is probably the most politically safe country in West Africa for operating. There are several other miners in the area, which makes Cardinal a likely takeout candidate.