Getting Started With Gold Investing

For me, the key to investing success has been to find resource companies that:

• are terribly undervalued at current prices and
  
• produce a resource for which I am bullish and
• have catalysts coming which will reduce the undervaluation.

Since the crash that has been Gold (and Silver to a lesser degree) Jr producing mining companies. Exploration companies are a whole nother kettle of fish that I am trying to spin up on.

Aside: I believe someone can make 50% a year (or more) if they don't have too much money to invest (say less than 5M$) and if they truly obsess over what they are doing and have paid, say, 3 to 5 years of dues (obsessing over investing) and are good at strategy games. That's me. It isn't nearly as much fun as my day-job and I'm not completely obsessing this year. It will be interesting to see how it impacts my results.

A friend of mine asked me how to get started spinning up on gold and precious metal investing.

Its a difficult question because there is a lot to learn and there is a lot of B.S. to wade thru.

I'll answer by listing the resources (in priority order) that I find and have found useful and try to dig up some "greatest hits". This post is probably worth more than anything I've posted in the last year. Finding the good information / analysis resources is probably the most important thing I do.

www.lemetropolecafe.com's daily midas column - covers the gold market every day in detail from the GATA perspective. This is the single best source for covering the precious metals markets in general. Costs $300/year. Worse than no help when it comes to stock picking. Cost is $299/year. For me, the most valuable part is watching whether they are importing gold in India or not. As long as the Indians are importing the price of gold is supported. The insights about the price suppression (and what days to look for it) are also turning (with some filtering) into a valuable futures trading resource.  

http://investorshub.advfn.com/boards/board.aspx?board_id=5834 - best stocking picking board I know of which is currently on gold and silver miners. Listen to anything Bobwins or Cl001 says. These guys make a tonne of money. 

http://jessescrossroadscafe.blogspot.com/ - who I want to be when I grow up. Analysis that is so true, so deep and with such a good spirit. And he covers precious metals occasionally. 

http://www.kingworldnews.com/kingworldnews/King_World_News.html - does great interviews (with a horrible web site, google "king world news" and interviewee names if you can't find what you are looking for) often about precious metals. The Ted Butler weekly wrapup will introduce you to the commitment of trader reports and how to interpret them (look out below when the commercial shorts and longs develop huge positions). Here's some other good interviews that should provide a good introduction to gold and miner stock picking:

• Jim Sinclair
• Pierre Lassonde
• Rick Rule

www.goldseek.com, www.321gold.com - have tonnes of commentator posts to wade thru. You'll have to learn you brings value and who doesn't.

http://harveyorgan.blogspot.com/ - provides a long daily piece with material stolen from all over the place including most of the good stuff from www.lemetropolecafe.com (but for free). 

I don't have any books to recommend. I'm currently reading Jim Dines' Gold Bug (pretty expensive) which is probably the best book I can recommend, but I'm not thru it enough to really say.

John Doody has a nice, safe methodical way of picking gold stocks (which is pretty much what I use only with smaller, off the beaten path stocks). I don't subscribe. IKN provides some great insight and has a true edge with micro-cap Latin America stocks. I do subscribe. I also subscribe to Bob Hoye's Institutional Investors (great pattern-matching technical analysis) and, because I keep feeling dazzled, I just got a Jim Dines subscription. I also am subscribed to Gary Biwii's news letter to learn a new form of technical analysis (and to keep from going off a cliff if something unexpected happens). Biwii's letter is cheap and seems very much worth it to me.

MontyHigh, www.worldofwallstreet.us

Comments

[Doug Digger Eberhardt]

Hi MontyHigh...

I thought you did a good job in providing sources for people to research investing in gold. I might add http://lewrockwell.com and http://globaleconomicanalysis.blogspot.com/ (Mish Shedlock) as a couple more places to get the real economic truth of what's going on (the fuel needed to convince one they need to be in gold).

I've written a book "How to Buy Gold Safely" I'd be happy to send to you. It's primarily a book that helps those who are starting out since, as you know, it can be treacherous waters and the sharks are circling, looking for the novice gold investors (which unfortunately is most of us).

I have to agree with your statement; "This post is probably worth more than anything I've posted in the last year." I might add, that it may be one of the few positive places for people to make money in the years to some, despite that it was also the best place to do so the last decade.