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Started small position in GDXJ
September 13th, 2012
In at $23.94, plan to continue to add
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2012-09-13 09:02 pm (UTC)
As you can guess, Shig, I like GDXJ a lot.
That said, today's performance versus peers was disappointing. On a strong rally day, it should rarely be beaten by SLV or GDX (IMO)--yet both bested it today. Perplexing, irksome. GDXJ should be knocking the ball out of the park on days like today, not being called safe at second on a close play.
Will this time be different? Will juniors follow, rather than lead, seniors? I have no idea. While I imagine GDXJ is still up the most in absolute percentage terms off its low (relative to peers GDX, SLV, and GLD), I'm pretty sure its lead should be greater.
All that said, welcome to the GDXJ family! Even if it moves up a couple more bucks before correcting, I'll be surprised if we don't get a chance to buy some more GDXJ below today's close sometime in the next few weeks.
Bottom line, rightly or wrongly, I love the PM sector as much as ever--and plan to continue to concentrate on GDXJ.
2012-09-13 09:46 pm (UTC)
I hear you regarding a likely chance to buy again under today's close. I was a little hesitant to buy into today's strength, but given that the SLV calls I bought just this morning were up 80+% at today's high, I felt okay about starting a small position in GDXJ even if I did buy at or close to the near-term high (could be interpreted as "i felt a little cocky").
I've wanted to start a position for a while, and for some reason haven't, but have been kicking myself after watching it's rise from $18 or so (though, of course, things were looking quite shaky when it was at those levels). Now that I started a position, I know I'll be more inclined to look for buying opportunities to continue to add. As you have said, a buck or two here or there really means nothing in the big picture if PM's do, indeed, reach new all-time highs.
I haven't paid close attention to the relative performance of GDXJ to the PM's and GDX, but will surely be doing so now. If today's pattern of less than desirable relative gains continue, it would likely result in my adding less over time or just holding onto the core position and putting my money elsewhere. MUX has seemed to perform extremely well on each and every up day, so that might be one that I would reestablish a position in and continue to add.
2012-09-13 11:38 pm (UTC)
I doubt there's a decent correction in our immediate future. When I sold some physical silver last (2011) spring, GDXJ was $37 or something. Because I don't think there's room for a meaningful correction yet, I sort of expect it to work still higher first. I see your entry price as long term very cheap, unless I'm dead wrong about the health of the secular bull. If GDXJ goes to $26, then has a decent correction, I'll expect to buy a little under today's close. If it goes to $30 before having a decent correction, I'll expect to buy at $25 or so.
MUX is very high risk, very high reward (IMO). I haven't been surprised by its remarkable strength, as it has a lot of seemingly bright people who believe in it (and believe in RM). GDXJ can never match the performance of the best performing single miners. I like it on account of the diversification it provides in a sector loaded with risk. If it doesn't start running to form, however, I'm going to start wishing I'd plunked down my money on a different nag. (Hopefully, it will.)
Just my personal opinions & plans.
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