Red-Hot Resources

"Luck is not chance, it’s toil; fortune’s expensive smile is earned.”

Thursday, December 14, 2006

End-of-Year Junior Crunch

I was on the phone with an executive of one of my favorite copper companies -- Red-Hot Canadian Small-Caps subscribers know which one I'm talking about -- as he wished me a Merry Christmas before he took his family off to a Mexican beach ... a beach that still hasn't been discovered by tourists. Meanwhile, my kids (Florida-born and raised) are threatening to run away unless I take them to see snow -- I guess everyone has their own idea of holiday heaven, LOL.

One of the things we discussed was how some Canadian junior natural resource stocks are getting beaten with a stick lately. It's not much to worry about -- it's just the end-of-year crunch we always see in Canadian Juniors It's when investors look at their accounts and decide what profits they want to take and what losses they want to cut. And it happens at a time of year when there is thin volume. Hence ... stocks get pushed around a lot.

For example, one of my favorite Canadian silver producers fell five percent yesterday -- on NOTHING. There is nothing wrong with this stock. It makes me want to issue a "BUY" recommendation, it's so cheap. But you know what, we already own plenty of it, and we have plenty of time to load up. For the next three weeks, the Canadian market tends to be on one big holiday.

Will I pick up extraordinary bargains? Sure. But it's really a time to pause, reflect, and figure out what I did wrong and right, with the hope that I can do even better in 2007. If you're a subscriber, look for an issue to that effect in the next few weeks.
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