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A dump truck drives through an oil sands mine near Fort McMurray.Ben Nelms/Bloomberg

Natural-resource stocks are white-knuckle investments, subject to wild, wealth-destroying swings from boom to bust. No wonder many professional investors shun them.

It's also why energy producers and miners may be just what your portfolio needs right now, according to Jeremy Grantham, the widely followed investment guru at GMO LLC, the Boston-based money manager.

"We believe the case for investing in resource equities is compelling," write Mr. Grantham and his GMO colleague Lucas White in a new research paper.

In part, they're enthusiastic precisely because so many investors have kicked resource stocks to the curb after the debacle of the past few years. The S&P 500, the benchmark U.S. index, has seen its exposure to energy and metal companies drop by more than half – from an average of 13 per cent in years past to around 5 per cent this summer.

Raw-materials producers are trading near historic lows, write the GMO duo. Based on measures such as dividend yield, price-to-book value and price to normalized earnings, resource stocks are about as cheap as they've ever been.

At similar points in the past, commodity producers have gone on to beat the broad market by nearly 7 per cent a year over the following five years, they calculate.

To be sure, expert forecasts for many commodity prices are distinctly negative. If the experts are right, commodity stocks may not be as cheap or as tempting as they appear.

But Mr. Grantham and Mr. White aren't overly impressed by the ability of Wall Street's finest minds to predict where markets are headed next. They looked back at the past couple of decades and compared year-ahead forecasts of oil prices from the leading analysts with the actual results.

"On average, the forecasts ended up being more than 30 per cent off realized prices," they report. "In fact, the experts got the direction right only a little better than half the time."

Longer-term forecasts were also far off the mark, according to Mr. Grantham and Mr. White. Given experts' lack of ability to foresee the future, they suggest that investors shouldn't be deterred by the negativity around the resource sector.

The key, they emphasize, is patience. Commodity producers tend to trade at a substantial discount to the broad market because of their penchant for pratfalls. Since April, 2011, through January of this year, raw-materials producers lost, on average, more than half of their value.

"However, for investors willing to weather the shorter-term storms, resource equities have actually been remarkably safe investments," write the co-authors. The broad S&P 500 index has lost value in real terms over many 10-year periods, but commodity producers have almost never done so, and never with anything more than a minimal loss of purchasing power.

Contrary to popular opinion, resource stocks have actually done better than the rest of the S&P 500 since the 1920s. "Our energy and metals basket has outperformed the broad market by more than 2 per cent per annum over the past 90 years or so, even after the historic commodity collapse of the past few years," they say.

Commodity producers offer protection against any future outburst of inflation, they note, as well as diversification benefits. They urge investors to consider adding more energy and metals stocks to their portfolios.

It seems that people are listening. Gold stocks have boomed this year and so have some diversified miners such as Teck Resources Ltd. and Glencore PLC. If Mr. Grantham and Mr. White are correct, more gains lie ahead.