Rick Rule, CEO at Sprott US Holdings, gives his opinion on the best time to buy exploration company.
“I would say to begin with that somebody who participates in these stocks needs to regard themselves as a speculator, not as an investor. Someone who is willing to take and accept real risk commodity prices themselves are risky and exploration is riskier. Still, that being said the reward is often very commensurate with the risk. The part about the exploration business that is really attractive to me now is as I say, well resource markets are soft, exploration markets are non-existent.
People regard bear markets with fear which is a mistake, people should regard bear markets as sales. If you went across the street here to Pacific Centre and walked through the Pacific Centre mall, you would be attracted to a store that said goods on sale, where goods on sales is a bear market. Bear markets are good and the exploration sector is unloved in fact, hated. Which means as a buyer you have very little competition for the goods which as a buyer is good for you.”