It's Not Too Late to Get Into This Huge 2012 Trade in Resource Stocks

By Matt Badiali, editor, S&A Resource Report Wednesday, February 8, 2012

It's not too late… but if you want to get on-board one of biggest money-making trades of 2012, you need to act soon. If you don't take action, you could miss out on 50%-100% gains this year. Over the past three months or so, my colleague Steve Sjuggerud and I have been writing about the "bad to less bad" opportunity setting up in natural resource stocks… the companies that mine things like copper, fertilizer, gold, silver, coal, and iron ore. Regular DailyWealth readers know this sector of the market is capable of experiencing huge booms and busts. Stay out of the busts, get in early on the booms, and you can easily make 50%-100% in a year with these companies. As I highlighted last month, resource stocks busted in 2011. They had enjoyed a big run higher in 2010. But when folks got scared of holding stocks and commodities last year (due to fears of the European debt crisis and the ripple effects it would have on the rest of the world), they dumped resource stocks… Major "trophy" stocks like Freeport-McMoRan (copper) and Vale (iron ore) lost 30%-50% of their values in just months. Smaller resource stocks lost even more. As Steve and I expected, resource stocks have put in a bottom… and have staged a big rally. For example, Freeport is up 26% since Steve ran this essay. While resource stocks are likely to take a short-term breather after this big surge, there's good reason to expect them to keep rising over the course of 2012. As my colleague Porter Stansberry recently noted, Europe is now printing money in order to stave off its debt crisis. The U.S. Federal Reserve has an ultra-stimulative interest rate policy in place right now. These efforts should "goose" the economy… which will drive up the prices of natural resources. That's a big tailwind for companies like Freeport. Since Freeport and its sector colleagues have climbed so much in such a short time, it's only reasonable to expect a small correction. That's just how the market works. When that correction arrives, use it as a buying opportunity… and let the coming natural resource "boom" do the rest. Good investing, Matt Badiali

Further Reading:

In addition to Freeport and Vale, Matt believes two other resource stocks are headed higher. "These are among the world's greatest 'boom and bust' sectors," he writes. And shares "have the potential to rally 50% or 100% in the coming year." Read more here: How to Risk a Little and Potentially Win A LOT in the Resource Market.

Viking Minerals: A mining company with huge potential

VKML is engaged in the acquisition and development of near-term producing copper, gold and silver properties in the United States and Canada.

Viking is focusing on developing its Dolly Varden properties in northeastern Nevada, adjacent to the Victoria Copper mine. The large resource of copper in this area has been well documented and hosts two large operating mines Battle Mountain and Robinson.

Positive assay results and "growing anticipation"

On Tuesday after the closing bell, VKML reported up to 5.23 percent copper from its first five assay results at the Dolly Varden Claims in Nevada.

The property continues to prove itself "as being highly mineralised with the potential for bulk tonnage copper, gold and silver recovery," said VKML's President Charles Irizarry in a September 6 press release.

"These results of up to 5.23% Copper from our first hole have exceeded our expectations," Irizarry said. "Especially when considering the neighboring Robinson Mine averages 0.5% copper. There is growing anticipation on what our next set of results will bring."

"Very optimistic that our property will be an important one"

In early June, VKML announced the acquisition of 16 claims in the Dolly Varden district in Elko County, Nevada -- "the world's third most prolific mining region," according to a June 1 press release.

The 16 claim property is adjacent to the Victoria Mine, which operated in the 1970's and 1980's producing over 24 million pounds of copper as well as the Dolly Varden Property which was a gold and copper producing mine, the press release stated.

"We are excited about the potential of our property. With its location in Elko County, which is a prolific mining area, and based on the results of our grab samples to date, we are very optimistic that our property will be an important one," Irizarry said in the June 1 press release.

Situated near properties with a history of production

There are 298 mines in Elko County, Nevada, located between Reno and Salt Lake City. Two of the most noteworthy mines include the Robinson Mine which is an open pit copper and gold mine that has operated continuously since 2005 producing averagely 121-126 million pounds per year of copper, and the Bingham Canyon Mine, which is the world's largest open pit mine and has produced more copper than any other mine in history - approximately 14.5 million tons.

According to VKML's Web site, The Dolly Varden property is located 75 miles south of the Victoria Mine and is close to Quadra Mining Co.'s huge Robinson mine, which in 2005 produced 126 million lbs. copper and 81,000 oz gold at grades of 0.6% Cu and 0.25 g/t Au. And 100 miles to the east is the Bingham Canyon mine.


Steps to increase shareholder value

Just a few months ago, VKML announced that it cancelled 240 million common shares in order to "greatly enhance the position of its shareholders," a June 23 press release stated.

"By reducing the issued and outstanding shares in our company by 240,000,000 or two thirds, we have not only dramatically enhanced our shareholders value, but also provided the company with the flexibility to acquire production assets using both cash and stock with minimal dilution to our share holders," Irizarry said in the June 23 press release.


An emphasis on near-term production

The Dolly Varden property could be a huge find for VKML. With a string of positive news releases in recent months, and positive assay results, VKML could be on the verge of a new phase of growth.

"The general market for Gold and Copper keeps getting better and better, it only makes sense to ramp up both exploration on the Dolly Varden as well as further acquisitions in Elko County area with an emphasis on near term production of both Gold and Copper," Irizarry said in a June 15 press release.

To learn more about VKML, visit: http://www.vikingmineralsinc.com/

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