Investment strategy in the mining industry. Stefan Ioannou, Mining Analyst at Cormark Securities shares his thoughts.
Investment strategy really comes down to your risk tolerance. Some of the best returns can make at early stage. It is through exploration companies. Essentially, it’s almost like buying a lottery ticket. Returns can be very high but the chance for failure is also high.
Conversely, established producers have steady cash flow profiles, long mine lives. They are well-defined ahead of them. It can also generate meaningful returns over a long period. They may not be subject to the windfalls that an exploration company may have.