Resource and Mining Stocks

As Australia is one of the world’s largest commodity exporters, the ASX is full of mining stocks. These cover the full commodity spectrum, from gold to oil to zinc, iron ore, and everything in between. Mining stocks can be massive multi-commodity producers like BHP Billiton Ltd [ASX:BHP], or tiny little explorers. In the middle of the spectrum are the developers. These are the companies that have found a resource and are in the process of developing it for production.

The Best Mining Stock Companies?

Mining companies are capital intensive. That is, they need a lot of capital to first search for a resource — drilling programs are not cheap — and then develop the resource and build an operating plant adjacent to the mine. That’s why commodity prices have such a big impact on these companies. When prices are high, the cash flow from production increases, as does the share price. But when prices decline, cash flow and share prices fall too. With risk comes reward, though. Mining stocks, especially explorers, could provide explosive gains if you back the right stock at the right time.

Related articles

Resource Stocks: A Market More Hated Than Tech Stocks…

Tech stocks down. Resources stocks down. In our view, that’s a great opportunity for Aussie investors to buy into two of the most exciting sectors on the market.

Why Coking Coal Could Out Perform Iron Ore

After iron ore, coking coal is the main ingredient in the production of steel. And because steel mills purchase the two commodities to produce the same product, the prices of iron ore and coking coal tend to rise and fall together.

Kris Sayce: Uncensored

It's not very often Money Morning editor Kris Sayce has time for a chat. Luckily for us, he kindly agreed to sit down and reflect on the year that's been and the one that's coming. Including his investment strategy for 2013.

Platinum and Palladium: Two Contrarian Bets in a Risky Market

South Africa's troubles have put two precious metals right in the spotlight for supply problems - platinum and palladium.

Everything You Need to Know About Junior Mining Stocks

Let’s make something clear up front: junior mining stocks are not for the faint of heart. Legendary investor Doug Casey calls them “the most volatile stocks on earth.” They can and do regularly undergo massive swings, both positive and negative.…