Ivanhoe Mines Ltd (IVN.TO)

A base metal stock that has a very distinct seasonality. Historically, the best time has been from October to approximately May of each year. Currently, this is still in a trading range and September could be a little difficult for base metal stocks. Watch this, because it looks like it is lining up for the next period of seasonal strength at around the middle of October.

(Top Pick Sep 28/16, Up 116.01%) Take your capital off the table, although he has not sold any of his holding because he tolerates more risk. The biggest risk is political instability in the Congo.

The base metal stocks over the last three weeks are showing some very strong technical strength. The long term trend is still to the upside. The resistance is at the $5.50 level. Strength will continue seasonally until the end of July. It is outperforming the TSX and above the 20 & 50 day moving averages. Watch for it to move above the $5.50 mark.

(A Top Pick Aug 11/16. Up 152%.) He has a tolerance for political risk, which is the only risk this company has. 3 world-class deposits including the best undeveloped platinum deposit in the world, and the 2 best undeveloped copper deposits in the world. Their 4^th asset is the highest zinc/copper deposit in the world. This is fronted by the most successful mining entrepreneur. What is wrong is that South Africa is challenging and the Congo is wrecked.

This has very strong periods of seasonal strength from about October through until usually April. The chart shows it is currently trying to form support at around $2.80. There is still a period of strength going forward, so there is an opportunity to continue owning this. There is a good chance of this taking a shot at its previous high. If it gets to that level, that would be the opportunity to take profits.

Has a rich copper discovery in the Democratic Republic of the Congo. Half their NAV is made up of this project. Very high grade, very robust. Working in the DRC can represent an elevated political risk. Another part of their NAV comes from the platinum project, which is also in south Africa, which he expects will not be developed until further out. That makes him question whether he should own this.

(A Top Pick March 8/16. Up 415.58%.) Sold half his holdings and got a 700% return, and sold the other half earlier making about 450% return.

You have two tier-one copper assets and a zinc deposit. Management has been serially successful. He is personally longer this stock on a cost basis than in any speculative position in his career.

Some of these material stocks, miners in particular, have been turning lower. This traded up to $5, and then down to a low of $3.76 recently. Broke its 20-day moving average, and is now approaching its 50-day moving average. 50-day is still pointing higher, so you could see support, but given the volatility it makes him nervous. You want to be out of the mines right now.

It did not do well when it first came out because it was in a bear market. Now it is now up 3-4 fold. It has fantastic momentum, but not valuation and stability going for it, however.

A case of a great mine, but a bad location. Recently sold his holdings. Quality assets. One mine is copper in the DRC in Africa as well as a platinum/nickel mine in south Africa. They are putting out great numbers on their copper mines, but he gets a little worried when the company gives out an additional 15% to the government for their continuing support. He is waiting for the price to get back to the $2.40-$2.50 range.

Robert Friedland has some very spicy assets in Africa, after his great success in Mongolia. There is always a bit of a problem with Africa, but he seems to know how to handle these places. Doesn’t know where the stock is going, but metals are in favour, so it might do well.

Recently sold this, because it had a good run up. Leading into the election and right after the election, copper prices soared phenomenally. He thinks there is a lot of copper supply out there. Not one that is short in demand with mines coming on. There is always some supply. This just seemed to get ahead of itself. He is looking for it to pull back 10%-15%, and then you will go back in and Buy it. They have fantastic assets. They have copper mines in the DRC and the platinum mine in south Africa. You can buy this at around $2 and you will do well long term with it.

There are 2 drivers for this. 1.) An absolute tier 1 platinum project in South Africa, and 2) the largest, highest grade copper discovery, unfortunately in the Congo. This is fronted by the most successful mining financier of this epoch. In his experience, tier 1 deposits succeed, despite politics, and they financed themselves irrespective of where they are. In the preliminary economic assessment, the upgrade for this deposit was 3%, 6 times the average grade worldwide. (Analysts price target is $2.38.)

We have had some very strong moves in base metal prices during the last couple of weeks. He prefers owning baskets of metal stocks through ETF’s. Historically, base metal prices move higher right around now, from around the middle of November right through until May of each year.