Top 5 Reasons to Invest in Junior Mining Stocks
While Junior Mining investing can be risky, the potential returns are massive which is why we’re going over the top 5 reasons to invest in junior mining stocks.
Junior mining is a form of mining that involves the exploration and extraction of minerals from regions with emerging economies. This form of mining is considered to be very risky because it is uncertain whether or not the mining operation will extract any minerals or if they will actually be viable for use as an economic resource.
There are many benefits to investing in junior mining due to the high upside potential. Junior miners are usually small scale operations that are just beginning in their progression towards becoming full scale miners. These companies typically have large reserves of untapped materials that could be worth a lot more in the future due to increasing demand for the materials. Junior mining also has less competition than regular mining.
It is important that investors do their due diligence when investing in junior mining in order to mitigate the risks associated with investing in such a risky industry.
The Top 5 Reasons to Invest in Junior Mining Stocks
1. It’s Easier to Meet the Management
One of the most critical elements of any investment is management. But sometimes it’s hard to get into contact with management for big name stocks. With Junior Mining stocks, you can reach out to the management directly and ask them your questions. No gatekeepers or barriers.
2. Junior mining stocks are the next big thing
According to the World Economic Forum, global mineral production has increased by five times in just 15 years – an average of 3% a year. In 2004 there were less than 50 juniors actively exploring for copper ore, while today there are more than 350 companies looking for new deposits. Junior Mining offers investors exposure to risks and opportunities not associated with large-cap stocks.
3. Rarity
Junior mining stocks are scarce goods and they are also priced accordingly. The rarity attribute makes these stocks sought-after and when countries rely on their import, demand increases. Take Rare Earth Elements for example, which prices have skyrocketed over the past few years as demand increases but supply still scarce.
4. Growth Potential
These stocks have the potential for significant returns, especially when mined projects come on line in an economic boom that boosts demand for natural resources. Junior miners leverage advances in technology to drill deeper and extract ore more efficiently than ever before because of their low initial capital expenditures. (read “Hype Versus Prospecting”).
5. Early Stage Investments
If you believe any commodity that has been in production for years might enter another growth cycle, junior mining investments are still early enough on the individual company level that gains could be compellingly realized by jumping into these risky investment opportunities without loads of experience or deep pocket finances just yet required.
Looking to get involved in more junior mining companies? One way is to follow Zimtu Capital as we provide access to companies that have early stage potential and are not normally available to the public. Learn more aty our upcoming event here: https://event.zimtu.com/.