Canada: Global Player

Canada is a global leader in mining and Canadian mining companies provide investment opportunities in energy, base metals and precious metals. This chart provides for production in Canada, but 45% of Canadian mining activity takes place outside Canada, making it an even stronger global player than this chart suggests:

With a strong Canadian dollar that has risen from 1.60 in 2001 to 1.12 against the US $ recently, investing in Canada provides a hedge against the US $.

It is our belief that the US$ will lose its reserve currency status in the coming years. And the prices of gold and silver will rise to levels that will allow investors to make (or enhance) fortunes.

There are many ways to invest in commodities, if you wish. You can buy the physical commodity, you can buy Exchange Traded Funds which hold the commodity for you or you can invest in shares of companies that produce of explore for those commodities.

Use gold as an example. Why invest in mining companies rather than gold itself?

Since 2001, gold (the yellow line) has risen from a low of US$ 256 to a 22 year high of $ 730, a rise of 188%. HUI (the blue line), an index of 16 major gold mining companies rose by 996% in the same period.

This means that your investment dollar would have returned 5.4 times more gains if invested in the HUI index than if invested in physical gold itself over the last five years!! This is the leverage that investing in mining equities can give you compared to buying the physical commodity itself.

for further reading: Opening a Brokerage Account in Canada

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