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Mining Political Risk Red-Lining

|Includes:COPX, VanEck Vectors Gold Miners ETF (GDX), GDXJ, GLDX, SIL

Political risk continues to be an increasing problem for miners. Yesterday Otto excerpted a particularly nasty PR from Pan American Silver regarding its Navidad project in Argentina, which it bought from Aquiline Resources.

In addition to political risk, mining investors face dilutive financing risk, execution risk and the risk that some of these projects just will not prove up as expected. Since I am a generally risk averse sort, I have been focusing on track record, net cash, proven resources and most definitely location; as in Nevada, Ontario, etc.

Not being a stock analyst, I find it easier to go with what is known - whether it be royalty income streams, established production, measured resources or significant cash levels - and leave the potential 20 baggers for more adventurous people with more adventurous risk vs. reward profiles. After all, even the less risky stuff has been puked up and put on sale over the last several months.

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Stocks: GDX, GDXJ, SIL, GLDX, COPX