Total Watch List
Investing in the mining sector comes with both advantages and disadvantages. Below, we offer insights on how to invest wisely in the mining markets, along with our top three picks for 2024/2025, and a company we recommend investors to familiarize themselves with urgently.
Disadvantages
Investing in financial markets always involves risk due to their volatile and unpredictable nature. This has been particularly evident over the past few years with the COVID-19 pandemic, which wiped trillions of dollars from global stock markets.
When market losses occur, the companies traded on these markets also experience comparable losses in their market values. This inherent risk underscores the need for careful judgment when investing in these markets.
Advantages
Most mining companies are engaged in producing essential commodities that sustain our world, such as precious metals, non-precious metals, coal, oil, gemstones, lithium, and limestone.
Because of this, the values of mining-related stocks are usually less affected by market volatility. The core materials being mined often provide a protective buffer against certain market influences.
For example, when market values decline due to geopolitical tensions or inflation, investors often turn to gold as a safe-haven investment. Consequently, companies mining gold see their market values supported by this trend. Similar examples apply to various other reasons why market values might drop, yet mining companies' values remain relatively stable.
Managing investment risk is why many investors choose mining investments based on the commodity being mined and the current causes of market volatility.
Our 2024 Top 3 Picks
BHP Group Ltd. (ticker: BHP)
BHP Group is a diversified resources company operating fully integrated mining assets that extract and process copper, iron ore, coal, nickel, zinc, and potash. Its mining assets span the globe.
BHP combines low-cost operations with a strong balance sheet, routinely selling its least-profitable mines and non-core assets to maintain financial health. BHP's cash on hand for the year ending December 31, 2023, was USD $15.476 billion.
Freeport-McMoRan Inc. (ticker: FCX)
Freeport-McMoRan is an American mining company based in Phoenix, Arizona, and the world's largest producer of molybdenum, and one of the world’s major copper producers.
The company's revenue in the third quarter of 2023 grew 58% year over year to USD $6.08 billion, due to higher copper prices and increased production. Freeport-McMoRan's cash on hand for the year ending December 31, 2023, was USD $8.068 billion.
Rio Tinto Limited (ticker: RTNTF)
Rio Tinto Limited is the second-largest mining company in the world. It mines a wide variety of products, including iron ore, aluminum, copper, uranium, and diamonds. Although it also mines gold and copper, its focus is on lithium and iron ore, where the company sees significant growth potential.
Rio Tinto's cash on hand for the year ending December 31, 2022, was USD $15.35 billion.
One to Watch
Gold Rim Exploration Inc. (ticker: TBA)
Gold Rim Exploration Inc. is a Canadian mining company incorporatedin 2007 and based in British Columbia, Canada. It mines precious metals in five countries, primarily focusing on gold, silver, platinum and diamond.
The company is known for its ethical and environmentally friendly mining operations. Currently, Gold Rim Exploration is expanding four of its sites and has its first European project on the horizon.
Gold Rim Exploration is our 'One to Watch' as they are engaged in four rounds of private placement funding, expected to result in their listing on the NYSE later this year. This listing is anticipated to significantly increase the company's value due to enhanced market exposure. Gold Rim Exploration's cash on hand for the year ending December 31, 2023, was USD $91.058 million.
DISCLAIMER: Total Mining News is not an investment, legal, or tax advisor or broker/dealer. All investment or financial opinions expressed by Total Mining News on the website https://www.totalminingnews.com are based on personal research and/or experience of the site owner and/or its employees and are intended as informational material only. It is important to do your own analysis/research before making any investment based on your personal circumstances. Total Mining News recommends seeking independent advice from a registered professional if needed.
