There is no question that the markets have been tough on junior mining and exploration companies, much tougher even than the broader markets. There is a chance that things could get worse before they get better. In spite of the poor markets, some companies continue to create value which is being reflected in rising share prices.
The outlook for the markets remains uncertain. Some major institutions are insolvent and global debt levels are soaring. Governments are doing whatever it takes to keep their economies chugging along, with seeming indifference to the longer term implications.
Many investors are choosing to wait on the side lines until the big picture be-comes clear. Others are recognizing that the economy will ultimately recover and are searching for bargains. Those investors who are selective have the potential to reap large benefits.
While the going is tough, some of the small resource companies have remained focused on their work plans and are achieving results. These companies are generating gains for share-holders despite the market conditions.
Those focused companies with tough management will continue to grow their assets and will continue to make new discoveries. Furthermore, they are in strong positions to benefit from the difficult markets, as they will be able to acquire assets at bargain prices from companies that are not coping with the tough markets.
Investors who build a position in strong companies now will be in a position to realize big gains as the tough companies advance their projects, produce metal or make new discoveries. With carefully selected investments, investors have the potential to turn these tough markets in their favor.
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