Private investor Don Hansen has honed his due diligence process over more than 20 years of resource sector involvement.
Speaking to the Investing News Network, he shared his strategies for evaluating gold and silver stocks, including his process for assessing risk/reward and how he analyzes market cap/gross margin.
Hansen also went through the questions he asks companies before investing, and explained why Aya Gold & Silver (TSX:AYA,OTCQX:AYASF), a pure-play silver producer focused on Morocco, is his favorite stock.
He’s preparing for a scenario where inflation potentially remains elevated for more than a decade.
“Right now I see that we’re headed into a significant inflationary period that could very easily last for 10 or 15 years,” Hansen said, noting that there are a variety of factors driving his outlook, such as the huge buildup of debt at various different levels.
“I’m trying to follow that and make sure that that’s still on track — am I still right about that? I’m quite sure at this point that I am, and that we’re going to start to see a major improvement in gold and silver prices as a result of that,” he noted.
Watch the interview above for Hansen’s thoughts on how to conduct due diligence for gold and silver stocks. You can also click the the timestamps below to view specific parts of the interview:
- 0:00 — Intro
- 0:32 — Don’s resource investing background
- 3:54 — Risk/reward analysis for mining stocks
- 10:00 — Understand your own risk tolerance
- 12:18 — Market cap/gross margin analysis
- 17:42 — Don’s top pick: Aya Gold & Silver
- 21:02 — Key due diligence questions to ask
- 28:00 — How to know when it’s time to sell
- 33:22 — Outro
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.