Metals Market Momentum - Selling Options on $WPM & $SBSW
TML March Update: Argentina, Bitcoin, Options Trades.
Hey there Maverick.
Today’s agenda:
Metals Market Moving - My barbell approach to playing the metals sector and commentary on SBSW 0.00%↑ WPM 0.00%↑
Argentina Update: Overview of my upcoming trip and my latest podcast with the
Income portfolio update and new trades (PAID)
Let’s dig in..
The metals trade has been frustrating for many with a massive rally, particularly in precious metals in June 2020 following the monetary and fiscal response from the US FED fizzling into a lot of sideways price action since.
However, it appears that a breakout may be imminent:
In addition to fundamental charts like this it’s hard not to be bullish.
Below lies the chart of percentage change in GOLD, SILVER and their associated mining indices (GDX and SIL).
People typically think that since metals historically do well in an inflationary environment, buying the producers of said metals must be even better given the expected leverage they have to their rising prices.
However, take a look at the chart below from Horizon Kinetics
Now I know, I know, certain producers can outperform in roaring bull markets.
But when you can expect roughly 17% ROI on such a simple, high margin, quality business model why take the extra risk aside from some small speculative capital?
Especially when these types of business do just fine even in a declining price environment. See below.
Oil producers are a different story.. but that’s for another day.
My levered speculative play on this theme is SBSW 0.00%↑ you can see my full breakdown and rationale here.
My next piece for members of
will be a valuation and breakdown of Wheaton Precious Metals WPM 0.00%↑ , the stock which outperformed in the above chart where I’ll share my valuation for various production and price scenarios.As you’ll see in the club, this thing actually has quite decent torque to upside prices without the risks of shitco explorers or major producers and with the options market providing some juicy premium, this One Man Insurance Co. is more than happy to sell insurance here. (More below).
Argentina Update
My trip to Chile & Argentina is fast approaching.
For an update on the current economic, social and political state of Argentina check out my most recent interview with the Patagonian Rabbit below:
If there’s enough interest I will share my journey and provide a ‘Maverick’s guide’ to the various places I have been fortunate enough to visit along my life’s’ journey.
Argentina where I plan to go ‘Full Maverick” and 4x4 the famous ‘ Ruta 40’ up to the Salt plains along the Bolivian border, before returning to Aus via Buenos Aires (if the Mara doesn’t get me so drunk I almost get lost in the city - true story).
The Maverick Life Portfolio:
Now, to business..
Squad members - scroll down for my review.
In true Maverick spirit, let's embrace adventure and see what happens.
See you inside the squad.
Benjamin.
Disclaimer: Options Mavericks is intended solely for documenting my personal journey with options trading for income and travel purposes. I am not a certified financial advisor, and none of the content provided should be construed as investment advice. It is essential to conduct your own thorough research and consult a registered financial service provider for appropriate guidance. I cannot guarantee the accuracy or completeness of the information presented. Any actions taken based on the information shared in Options Mavericks are done at your own risk and discretion.
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