Stockwatch NewsGlobe says Detour, others fit Gordon's buy criteria
2011-01-25 09:16 ET - In the News
See In the News (C-DGC) Detour Gold Corp
The Globe and Mail reportsin its Tuesday, Jan. 25, edition that investing in junior goldexploration companies is risky, but can be very profitable. The Globe'sMartin Mittelstaedt writes that newsletter writer Ian Gordon saysinvestors should try to focus on companies that have land positionsaround existing or former mines, under the theory that this is probablywhere more gold can be found at the lowest risk. He also advises seekingout juniors with minority interests held by senior producers, a signthat deposits are promising. Another indication of a worthwhile buy iswhen top performing gold fund managers take a liking to a company.Mr. Gordon has invested in junior gold miners for the past 11 years. Hesays he has generated a yearly compound return of 70 per cent. Hebelieves the junior sector still has lots of room to rally.Typical of the approach of picking a stock in an existing goldfield isDetour Gold, which is developing a highly regarded deposit in Ontario inthe Abitibi Greenstone belt.Sometimes investors can twig to an opportunity when a major getsinvolved with a junior. Golden Goliath Resources is exploring Mexicanproperties, in which senior producer Agnico-Eagle Mines has announced anoption agreement.