MINING STOCKS ARE ON THE MOVE!
Written by: Robert and Russell Markham
Mining stocks are on the move! How do I know? It is on your Home Page…you can check out the best performing industries by simply monitoring the Top RT Industries gadget. The Top RT Industries gadget sits directly below your Color Guard gadget per the default layout.
Glancing at the Home Page as of the 4th of April, the Top 3 industries by Relative Timing (RT) are as follows:
Materials (Lithium) followed by Materials (Aluminum) and Materials (Steel). The common theme here is mining stocks! Recall the Essay on Lithium Stocks on the 25th of March this year? This week we go a bit further by looking at all mining stocks. To begin, we will identify some of the key drivers of why prices are rising across key mining commodities and then apply the power of VectorVest to shortlist a handful of the top mining stocks to be aware of in Australia.
First up, what is driving up mining stocks? Below are some of the key reasons:
* Russian sanctions restricting imports along with supply disruptions.
* Demand for mining commodities are above pre-pandemic levels.
* Billions of dollars in stimulus packages around the world.
* Coronavirus is not the threat it once was – restoring business confidence.
* The move towards decarbonisation is driving up demand for mining commodities.
* Demand not always being met by supply.
* Higher production costs and labour shortages are hampering production.
* Wild weather around the world hampering mining operations.
* Higher inflation likely to push up mining commodities.
* Stronger electric car demand.
* Finance and time constraints to upgrade world mines for key commodities.
It is of no surprise to read the following:
“Minister for Trade, Tourism, and Investment Dan Tehan and United States Secretary of Commerce Gina Raimondo are working together on key challenges including building more secure supply chains and facilitating a clean transition that supports Paris Agreement targets.
Tehan and Raimondo met on March 30 in Washington DC for the inaugural Australia-US Strategic Commercial Dialogue (AUSSCD) and discussed the energy transition and how it will depend in large part on securing a resilient and diversified supply of critical minerals – for use in everything from electric vehicle chargers and batteries to solar panels, wind turbines, and semiconductors.”
With the macro picture set, let’s now apply the power of VectorVest to find some of the best mining companies in Australia. To do so, we turn to UniSearch which will shortlist the best mining stocks for us. To seek out the mining stocks, we have screened the stocks by the materials industry that relate to mining which include:
Aluminium, Diversified Metals/Mining, Gold, Lithium, Precious Metals/Minerals and Steel.
In the video which follows, we will show you exactly how to do this.
For this week, we have created a BackTest of the mining stock industries noted above. The results are very telling. Mining was in a slump in recent years up until late 2020 where things started to turn around on the BackTest we ran. This not surprisingly corresponds with the uplift we have seen in the mining commodities globally. The BackTesting identified some of our best performers which included:
AKE.AX, GL1.AX, PLS.AX, S32.AX and MLX.AX. These 5 stocks are up over 45% since the start of 2022 to the 4th of April.
Key points from the video which follows:
* How to setup a useful mining stocks search.
* BackTesting applying the mining search has shot up over 100% since July 2020.
* Volatility in our mining stock BackTest has halved from May 2020.
* The mining Portfolio has averaged 2 to 3 trades a month.
For further resources on the mining boom at present:
Please click here.
If you have further questions about the information provided in the webcast, please give us a call. Our VectorVest Consultants are ready to help you.
VectorVest Inc (ARBN 654 498 218) and Russell Markham are Authorised Representatives (No. 1294036 and No 1294037) of Centra Wealth Pty Ltd (ABN 39 158 802 450) which holds an Australian Financial Services License (AFSL No. 422704).
Please refer to our Financial Services Guide at https://vectorvestau.wpengine.com/financial-services-guide/ which provides you with information about us and services we can provide. Any advice is general advice only and does not consider your personal objectives, financial situations or needs. You should consider whether the advice is suitable for you and your personal circumstances.
Any advice is general advice only and does not consider your personal objectives, financial situations or needs. You should consider whether the advice is suitable for you and your personal circumstances.
Past performance is not a guarantee of future results. Forecasts and BackTests used or discussed in this presentation are intended as a guide only and actual results may be affected by known or unknown risk and uncertainties and therefore may differ materially from results ultimately achieved.