Senior Silver Mining Companies

The situation is different with senior mining companies. These companies are larger in size, more experienced, and own their mining sites. Given that their mining sites are already established, it is easier for investors to assess how well the miner is going to perform. A degree of consistency and fewer surprises follow from this when we speak of stock prices. Junior miners work differently, having to identify and explore the potential of new mining sites. There is always a risk that exploration will not result in actual discovery. This may be a costly initiative for junior mining sites and their investors. When a junior mining company opens a mine and begins exploitation, it will often sell the site to a larger and more experienced miner as to ensure higher returns. However, if the miner does not have funds to even start exploitation, this signals financial losses to follow. medal

If investing in senior and junior silver miners, you should know what these types of miners have to offer in terms of value and risk. Those who plan to invest in senior minors can look at companies’ balance sheets and income statements to find out what these companies are worth. Junior miners are different in that investors should look at properties and charts and know more about the management of these companies. In many of these cases, there is no way of knowing whether a junior miner will make a discovery or not. Some investors just rely on their intuition, but experts recommend gathering as much information as possible. If the management body has done something worthwhile in the small mining sector or in exploration, one can get a feel as to how the company is run.  Another indicator of a sound company is if its management had run or discovered a profitable mining site in the past. Naturally, investors also want to look at the cash balance and cash flow of junior mining companies.

Although some companies may have developed good projects, high burn rate means that they will have to close operations in a couple of months. This is a likely outcome if the management does not have access to additional financing. The management should be able to respond on the question of how long they can continue operations if things do not go according to plan.

Another important issue is whether the property or project they develop has any potential. Of course, you are likely to get estimates and there is no guarantee that the actual quantities of silver will match these. It is possible that the management, financial controllers, and geologists promise more as to attract investors. Exploration is not always possible even if the site has a good potential. For example, the infrastructure costs may be too high or the region may be hard to access, even though the drill results are decent.