Although silver is more or less sitting on its high and has not really declined appreciably after making it, silver stocks are off their highs by almost 10%. I attribute this to several factors: a) people are fearing that silver has hit a top and will decline drastically from here b)some big boys are selling short now to depress the price so that they can buy cheap c) ultimately, silver stocks are only marginally profitable, so "value" investors are still not excited. Would like your opinion on short term and midterm prospects. Thanks in advance
a few ideas for the stocks recent lag to the PM price:
1. the stocks are being diluted - PAAS has done two transactions in the past month that issued more shares. 2. prior to the recent stagnation in the stock price, the shares ran up > PM, maybe getting ahead of themselves. 3. stability risk at 3rd world mines
Up until recently (last November) silver was in a compaletely stealth bullmarket. Now, it is starting to be noticed. Hence, when weak hands (newbies) start buying in they also trade out at the dop of a hat! This is the best explanation that I can offer. The bullion will have corrections, but the bull is loose and silver will for sure exceed $50 per ounce within 20 months (IMHO). Sit tight and be right....BTW I am adding to my positions in silvers and golds now by about $100K. I smell a big share rally this spring.