Volatile Returns: Commodity Investing Through Miners and Explorers #infographic

 

Volatile Returns: Commodity Investing Through Miners and Explorers #infographic

Gold and silver are regarded by investors as safe haven investments. Yet gold and silver-producing firms also deliver unpredictable returns, creating opportunities for clever investors.Volatility is a double-edged sword, particularly when it comes to investing in commodities. It can generate skyrocketing returns during the good times. But it can turn nasty during hard times.Today's infographic from Prospector Portal shows us how investing in shares in precious metals can outperform or underperform the wider market for metals.

Volatility Capitalizing: Pacing Matters

Timing matters for goods, just as with most investments.Unexpected demand shocks are met with slower supply responses due to the diverse production processes of commodities. This causes product supercycles, along with other variables, sustained periods of upswings and marketdownswings.Investors need time to take advantage of this uncertainty in their portfolios, and there are many ways to do so.

The Evidence: How mining equities react to metal prices

Price changes not only translate into higher income for mining companies, but the outlook and value of exploration companies can also change. As a result, it can be a perfect way to gain exposure to changing rates to invest in exploration companies.

That said, over a shorter period of time when prices are high, these types of companies can produce higher equity returns, but they can also turn drastically negative when prices are low.In the bull and bear markets for precious metals, we compare how producers and exploration companies with an NI-43-101 compliant resource do.

Exploration 's capacity for investment

During bull markets, mining equities appear to outperform underlying commodity prices, although underperforming during bear markets.

These impacts are much more pronounced for mining exploration firms. Exploration firms are high-risk, but when it comes to investing in commodities, they can deliver high rewards.

You have to know the risks and grab the market at the right time to reap the benefits of volatile returns.

Volatile Returns: Commodity Investing Through Miners and Explorers #infographic

infographic by: www.visualcapitalist.com

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