I am buying another junior resource company to add to my list of Speculations. I am already an owner of Fireweed Zinc (FWZ), but I am buying another tranche and will consider it an opening position in keeping with the formalities of this blog. This company owns a large and growing zinc asset in the Yukon validated by an investment from Teck Resources (TECK) and is headed by an extremely capable and communicative CEO, Brandon Macdonald. Negative sentiment is strong in the zinc space for plenty of good reasons including slowing economies and trade wars. Tax loss selling and the lack of near term catalysts due to exploration being unfeasible at Macmillan Pass during the winter as well as many investors rotating into precious metals and away from base metals juniors will add extra pressure to this stock. I am prepared to build up my position in this company and to tuck it away for the long term. The zinc market will turn and by that time FWZ’s zinc resource will likely be larger.
And we could get lucky with zinc prices turning around more quickly than anticipated. I am already heavily invested in precious metals so I am looking at FWZ as a slice of an array of non-precious metals juniors that would likely benefit in case worldwide recession and doom are not imminent. So it is a portfolio hedge as well.
Bought tranche at $0.53 (CAD).