Chris Thompson of Haywood Securities - ranked as the top stock picker in the metals and mining sector in the latest StarMine awards - joined us for a live discussion Wednesday.
The following is a full transcript:
1:03 Darcy Keith - Hello everyone! Welcome to this live discussion. We'll be getting underway in just a brief moment.
1:04 Darcy Keith - Hello Chris
1:05 [Comment From Chris ]
Hello everyone - welcome to our live chat
1:06 Darcy Keith - Thanks for joining us today - should be a great discussion.
1:06 Darcy Keith - Just to start things off Chris, I'm wondering about your overall thoughts on the metals markets - and which sectors are your favourites right now.
1:09 [Comment From Chris]
Obviously, we are going through a phase of market weakness at the moment - driven by some macro-economic uncertainty. Metal prices are still firm - gold - silver and copper. I see precious metals as offering the best medium term upside on the back of their role as a hedge against economic uncertainty.
1:11 [Comment From Ian from Halifax ]
Hi Chris - can you let me know what your thoughts are regarding gold mining in Congo - specifically junior exploration companies?
1:14 [Comment From Chris]
Thanks Ian - the Congo is a very well endowed region for metals exploration - and offers significant exploration upside - but this must be balanced in the context of political risk
1:14 [Comment From AustinC ]
Chris, do you think we could see a major correction in precious metal prices like we saw in 2008? If economic issues lead to another market correction, are commodities vulnerable again? If not, what would make this time different?
1:20 [Comment From Chris]
As far as metal prices - gold corrected marginally - but has since doubled - silver corrected significantly on the back of economic concerns - I feel that precious metal prices will remain firm - but I feel we are in for a short term period of potental weakness
1:21 [Comment From Julie ]
We have many silver coins at home. I understand the years that will be of any value are 1968 and earlier. Do you think the value of these coins will increase significantly over the next 6 months?
1:21 Darcy Keith - I think, put another way Chris, do you have any specific price forecasts for silver over the next six to 12 months?
1:24 [Comment From Chris]
We forecast an average silver price of $32 / oz this year dropping to $20 / oz in 2016. This looks conservative based on silver's recent run. We need to see firm prices at $35 / oz for a few more months - and market analysts will feel more comfortable in increasing their long-term projections.
1:25 [Comment From Mike ]
Hi Chris, what is your take on owning the actual metals vs. mining stocks? There seems to be a disparity between the increase in actual metals vs. mining stocks.
1:31 [Comment From Chris]
Thanks - a worry in the sector right now relates to geo-political risk - on the back of the belief that local communities aren't enjoying the benefits of high metal prices - this has contributed to a soft market for equities - together with technical risk - a relative lack of M & A activity and tight markets for raising significant funds for high capex cost projects. I would recommens a balanced approach - hold both - stick to good quality management teams
1:32 [Comment From Tom, Oakville ]
Hi Chris, I'd appreciate your views on Molybdenum and your recommendations re any good investment opportunities.
1:36 [Comment From Chris]
I don't cover the moly space - but my colleague Stefan Ioannou does - he covers a number of stories - Mercator which when they bring Creston on-line in 2015 will make them one of the largest moly producers in the world. fFel free to give him a call.
1:37 [Comment From Damien ]