Artemis Gold (ARTG.V) is approaching First Pour at its Blackwater Gold Mine in British Columbia. I just sold my shares and booked another big win on a pre-production sweet spot (PPSS) play.
I’m not saying this to boast, but to make an important point. Bear with me a moment.
You see, to my knowledge, I’m the first person to systematically research and document the potential gains in the PPSS. I did so about eight years ago when I worked for Doug Casey. Most of these trades had positive results, and the average gain—much to Doug’s surprise—was better than 100%. The findings looked solid, so we published them in Doug’s International Speculator.
This led to several great speculations—but it also let the cat out of the bag. Truth be told, once they knew the “recipe,” people could “do this at home”… and many did.
I’ve been asked why I didn’t keep “the greatest discovery of my career” (as Rick Rule calls it) under wraps. I could have made money trading on my “secret formula.”
Well, maybe. For a while. But it would have been pretty obvious what I was doing when I kept betting on first-time mine-builders…
At any rate, I did let the cat out of the bag. Other shops started making the same bets, giving rise to a new problem. There are only a few PPSS plays per year. If everyone bets on the same ones, won’t they become crowded trades with success priced in advance?
Recent high-profile cases like SilverCrest—which surged even before a formal construction decision was announced and then traded largely sideways until First Pour—made it look that way. This prompted people to ask if the PPSS play was dead.
In response, I focused my stock-picking on pre-PPSS plays, to get in ahead of the crowd.
However, the Artemis case shows that one can still bag a double or better on a great PPSS play. As you can see in my public track record, my gain was about 128%.
Better yet, Artemis isn’t the only case. G Mining (GMIN.TO) is another recent PPSS success story, which delivered a 217.5% gain from its construction decision to First Pour. Boss Energy (BOE.AX) recently showed that the PPSS strategy works in the uranium space as well, yielding an 82.9% gain.
This is very good news, not just for me, but for all resource speculators: the PPSS is alive and well.
That said, the issue of this investment strategy now being well known among resource speculators means the crowded trade remains a problem. And of course, not all PPSS plays work out.
So I’m maintaining my focus on picking the best pre-PPSS plays before they’re obvious—and beating the crowd to them.
Caveat emptor,
P.S. Want to know when I find a PPSS play in the making I’m willing to bet on? That’s one of many key deliverables you receive with a subscription to The Independent Speculator.\
