I also wanted to say a bit about why three of my largest positions right now are Ivanhoe, Tinka, and Regulus.
To oversimplify a bit for the purpose of explanation, there are essentially two ways to approach drilling up a deposit.
One method is followed by promotionally oriented companies whose primary purpose is to sell stock bought by insiders at cheap prices to retail investors at inflate prices. These companies choose to drill only where they know they can hit good intercepts which can be used as headlines in PRs. These companies almost always work with unscrupulous newsletter writers and 'analysts' who have been supplied with cheap stock sof their own in return for writing up breathless recommendations with lots of exclamation points to assist in luring in the unwary retail investors.
Occasionally these companies do accidentally find a real mine, but that is not their primary purpose.
OTOH, companies like IVN, TK, and REG which are actually interested in finding mines, drill out their deposits in a different manner. Yes, they do the necessary infill drilling, but especially in the early stages of a discovery, their main preoccupation is doing stepouts, concentrating on defining the outer limits of the deposit so they know where to concentrate the infill drilling.
Think about this. For good reasons, they are actively trying to come up with poor drill results, which is the worst possible outcome for a promotionally oriented company.
Of course they can be upsides to this approach too. When IVN did a 5 km stepout at Kakula and got excellent intercepts, it did great things for the sare price, as it should. It also means IVN will have to step out even further to get those poor drill results they are looking for.
I should also point out that management at IVN, REG, and TK have all previously found and developed deposits before selling them to majors. Track record is vital for evaluating junior management.
You can make money on the promotional companies if you play their promorional cycle carefully, but I prefer to stick with companies like IVN, TK, and REG, accumulating their stock when it is cheap, trading a portion to reduce my cost basis if I can get a handle on how it trades, but above all sticking with them long enough to reap the harvest.
LC
