Investing Assets Held in a TFSA

[msog87]

So maybe I should just buy $420 worth of gold or silver every month... can you do that within a TFSA?

yeah you can. slv is the silver bullion etf that tracks the market , gld is the gold etf. you should also be able to buy from your broker physical gold certificates. keep in mind, silver is very volatile, right now happens to be a great time to buy as it has had a 50% correction from april of 2011 when it hit $50. I would put my money into precious metals, energy, and agriculture. I would advise you right now instead of buying bullion, buy some mining shares as they are extremely oversold and it just so happens that relative to the gold/silver price they are the cheapest they have been in a decade. id say make half your portfolio senior producers, and the other half junior producers that have a strong path for growth. tell me how much money you have to invest and ill create an example portfolio for you of what id buy, quality companies whos share prices are very very ripe right now

 

[johnnyone1]

yeah you can. slv is the silver bullion etf that tracks the market , gld is the gold etf. you should also be able to buy from your broker physical gold certificates. keep in mind, silver is very volatile, right now happens to be a great time to buy as it has had a 50% correction from april of 2011 when it hit $50. I would put my money into precious metals, energy, and agriculture. I would advise you right now instead of buying bullion, buy some mining shares as they are extremely oversold and it just so happens that relative to the gold/silver price they are the cheapest they have been in a decade. id say make half your portfolio senior producers, and the other half junior producers that have a strong path for growth. tell me how much money you have to invest and ill create an example portfolio for you of what id buy, quality companies whos share prices are very very ripe right now

As I've stated earlier in this thread, this is really only about the present balance of $6,200.00 in my TFSA and the regular deposits of $420.00 every 4 weeks ($5,460.00 annually). This will continue to accumulate at that rate for as long as I draw breath. So should I invest each $420.00 as it becomes available or let it accumulate and do it quarterly or semi-annually?

I do have other funds but they are not available to me at the present time.

Any advise and examples you could give me would be most welcome.

Thanks -- J1

 

[msog87]

As I've stated earlier in this thread, this is really only about the present balance of $6,200.00 in my TFSA and the regular deposits of $420.00 every 4 weeks ($5,460.00 annually). This will continue to accumulate at that rate for as long as I draw breath. So should I invest each $420.00 as it becomes available or let it accumulate and do it quarterly or semi-annually?

I do have other funds but they are not available to me at the present time.

Any advise and examples you could give me would be most welcome.

Thanks -- J1

ok, so with the current 6200 cash id put it all in junior mining companies, only bc we are talking a 6k portfolio, the less money you have to invest the more growth you need, the more bang for your buck. my favourite agriculture company right now is allana potash which is in ethiopia and is currently being developed, they have 1 billion tonnes of potash and are situated right next to india and china the largest consumers of potash. they plan to be in production by 2015 they are a very advanced project in a mining friendly, stable country. the stock will very easily give you a 10x return on your money should everything go to plan, right now the market value of the company is only 100 million which is very small as potash goes for $500 a ton.

the other company you should buy is spanish mountain gold. they have a 6 million oz + gold deposit in B.C. , they are an advanced project, the goal is to be in production by 2015 producing 200k oz a year. the current market value of the company is 69 million its very undervalued, once they go into production you are looking at a billion dollar market value very easily, I know this by looking at other more mature companies.

the other company is wildcat silver, they have 250 million oz in the ground ( the resource is going to be upgraded in a few weeks). the deposit is in arizona, they also plan to be into production producing 6-10 million oz a year. should everything go to plan this stock will also give you a 10x return minimum just like the others, in fact another silver company I own first majestic which currently produces 8 million oz a year has a 1.8 billion market cap, this will be wildcat in the future so at current levels this would mean an 18x return on your money.. right now the market cap for wildcat is 100 million. so I would ivest the 6200 evenly into these 3 companies. these are quality advanced projects, lets say for the sake of argument 2 fail in the next 2 years due to whatever reason which is very highly unlikely, the one successful company would still give you a 10x+ return so yo;d still be better off. now lets say all 3 are successful, you are looking at over 50k in your account and we are talking in only a few years. it sounds too good to be true but just take a look at other more mature companies stock charts, it is very doable and has happened many times with other companies. this month is the perfect time to buy as all these stocks have had over a 50% correction in the past year...very very oversold. they have bottomed, and the fed is soon going to print alot of money, as with the ecb. this is going to send historically high commodity prices even higher, weve just been through a deflationary downtrend from a lack of stimulus, during deflationary periods commodity prices fall, as with stocks. we are about to begin another inflationary uptrend, the last inflationary uptrend lasted from march 2009 to may 2011. that stock first majestic for example went from a penny stock under $1 to over $25 a share, 25x return. research the companies ive mentioned, and id advise you to strike before september. you will also pay no capital gains taxes in your TFSA

with the rest of your money that will steadily flow into your account you can either add to your current positions or buy other companies or just keep a cash position for another opportunity. the stock market is seasonally strong from september to may, depending on the specific fundamentals in the market at that time in general the smart thing to do is sell mid april, and re buy in the summer after shares have had a correction. you also have to look at the techicals of the stocks you own, if they have had a huge rally and are well above the 200 day moving average, its a goodtime to sell. but I dont want to confuse you, all you need to know is right now is an amazing opportunity in the resource sector, come april if its time to sell I will be here to let you know. fyi, I own all these companies mentioned and yes I missed out on first majestics 25x return! even if commodity prices remain stagnant which they wont these stocks are still gonna perform as mentioned, the higher commodity prices go the more profits they will make.

 

[johnnyone1]

Re above ^^^

Thanks msog87.

I'll give your recommendations a shot.

 

[msog87]

Re above ^^^

Thanks msog87.

I'll give your recommendations a shot.

btw, these companies have little to no debt. junior miners rely on investors to fund them up until they are producing companies making a profit, so you also need strong management and good fndamentals that attract investors, those 3 companies have that going for them as well. wish you well and give an update

 

[danibbler]

lol RBC and chevron are not factoring in all the trillions of dollars that have yet to be printed by central banks to keep the world economy afloat. I wouldnt listen to any mainstream bank they are clueless rbc just released a report saying how theres no housing bubble in toronto. look at the state of the world economy today, its a disaster and oil is at $90 a barrel, how do you figure the price to be lower in 5 years. youll find many more predictions of $100+ oil than under $100. And no the drought in the u.s. isnt responsible for high food prices, weve had lots of droughts in the past and prices were never near as high. food prices are rising for the same reason gold and oil are rising. do yourself a favour when ben bernanke announces QE3 which is probably on september 13th, go to www.forexpros.com and look at the commodity price gains that will have just begun. the ecb is also gonna print alot of money to bail out europe which will also spike commodities. this bull market in commodities has been going on since the year 2000, that is the same time the bear market in stock indices started. from 1980-2000 it was the opposite.

So, let me get this straight:

First, RBC and Chevron, despite their teams of analysts and economists do not factor in something as fundamental as inflation?
Second, I have yet to find any prediction of oil being above $100 in five years. I'd like to see you bring up a few. Recent ones, not from three years ago.

Interesting that you're now backing off that $200 price in ten years...

 

[danibbler]

ok, so with the current 6200 cash id put it all in junior mining companies, only bc we are talking a 6k portfolio, the less money you have to invest the more growth you need, the more bang for your buck. my favourite agriculture company right now is allana potash which is in ethiopia and is currently being developed, they have 1 billion tonnes of potash and are situated right next to india and china the largest consumers of potash. they plan to be in production by 2015 they are a very advanced project in a mining friendly, stable country. the stock will very easily give you a 10x return on your money should everything go to plan, right now the market value of the company is only 100 million which is very small as potash goes for $500 a ton.

Ethiopia? I'd ask if you're joking but unfortunately you sound serious.

This is a gamble, pure and simple.

- the country is not right next door to India and China. In fact, China is probably closer to Canada and PotashCorp than it is to Ethiopia! And both of those countries have driven hard bargains in the last three years on their potash purchases.
- getting the potash out is not going to be easy because the Ethiopia is landlocked and it depends on one railroad
- it is not politically stable.

The country also has large mineral resources and oil potential in some of the less inhabited regions. Political instability in those regions, however, has inhibited development.

http://en.wikipedia.org/wiki/Ethiopia#Economy

 

[msog87]

So, let me get this straight:

First, RBC and Chevron, despite their teams of analysts and economists do not factor in something as fundamental as inflation?
Second, I have yet to find any prediction of oil being above $100 in five years. I'd like to see you bring up a few. Recent ones, not from three years ago.

Interesting that you're now backing off that $200 price in ten years...

chevron is making conservative estimates of the future price of oil, they base their future profit projections, business spending etc on this base price. You talk about a lack of predictions of oil over $100 for the next 5 years wti right now is at $93, brent is $113. oil is above $100. the price has been in a strong uptrend for the past 20 years, wti hit $148 in 2008, had a large correction in the crash of 08, and has quickly rebounded to the $100 area, we were at $115 in february 2011, we will easily take out that high this year. And yes RBC, scotia etc, all these major banks are clueless and i would not take any investment advice from them they have been right about nothing, predicted nothing, they understate inflation etc. they dont see an obvious housing bubble, they are bearish on the canadian dollar, they have been expecting a u.s. recovery etc list goes on. I am not backing off my $200 estimate at all, it will happen this decade. back in 1990 wti was $20 a barrel, it went up to $148 in 2008, thats a what 700% increase? these kinds of things happen in bull markets all the time. even the notoriously wrong to the downside u.s. govt says $200 could be possible by 2020 and you know they arnt factoring in a big decline in the u.s. dollar, I found that by doing a quick search

http://www.theatlantic.com/business...-oil-the-government-says-its-possible/259243/

 

[danibbler]

chevron is making conservative estimates of the future price of oil, they base their future profit projections, business spending etc on this base price. You talk about a lack of predictions of oil over $100 for the next 5 years wti right now is at $93, brent is $113. oil is above $100. the price has been in a strong uptrend for the past 20 years, wti hit $148 in 2008, had a large correction in the crash of 08, and has quickly rebounded to the $100 area, we were at $115 in february 2011, we will easily take out that high this year. And yes RBC, scotia etc, all these major banks are clueless and i would not take any investment advice from them they have been right about nothing, predicted nothing, they understate inflation etc. they dont see an obvious housing bubble, they are bearish on the canadian dollar, they have been expecting a u.s. recovery etc list goes on. I am not backing off my $200 estimate at all, it will happen this decade. back in 1990 wti was $20 a barrel, it went up to $148 in 2008, thats a what 700% increase? these kinds of things happen in bull markets all the time. even the notoriously wrong to the downside u.s. govt says $200 could be possible by 2020 and you know they arnt factoring in a big decline in the u.s. dollar, I found that by doing a quick search

http://www.theatlantic.com/business...-oil-the-government-says-its-possible/259243/

Oh, right, the US gov't...you mean the one that you think is going to destroy the real value of currency? The one with the trillion dollar debt load? You trust them?

Let's have a look at the article...ok, yes, $200 is the extreme in 2020...as is $60...with the median being $125 or so.

 

[msog87]

Ethiopia? I'd ask if you're joking but unfortunately you sound serious.

This is a gamble, pure and simple.

- the country is not right next door to India and China. In fact, China is probably closer to Canada and PotashCorp than it is to Ethiopia! And both of those countries have driven hard bargains in the last three years on their potash purchases.
- getting the potash out is not going to be easy because the Ethiopia is landlocked and it depends on one railroad
- it is not politically stable.



http://en.wikipedia.org/wiki/Ethiopia#Economy

what I mean is they are very close to the largest potash markets in the world. potash from saskatchewan has to be shipped by boat from much further away. ethiopia has had on average 7-10% gdp growth for the past 10 years, its one of the fastest growing economies in the world. it has a business friendly government which by the way are currently building a railroad for allana potash so allana and other companies can ship their products by rail to the coast to ship by boat. their military is one of if not the strongest in africa, they are a politically stable and business friendly country.

 

[msog87]

Oh, right, the US gov't...you mean the one that you think is going to destroy the real value of currency? The one with the trillion dollar debt load? You trust them?

Let's have a look at the article...ok, yes, $200 is the extreme in 2020...as is $60...with the median being $125 or so.

the u.s. govt is wrong just like how they are always wrong when predicting future deficits and federal debt. I showed that link just bc it shows the u.s. govt sees a possibilty of it happening. but anyone else can just do a search of their own for other examples in the media. there are many experts calling for $200 crude in the next decade. people like jim rogers, peter schiff who have better track records than any mainstream economist that works for RBC or whoever. I mean if israel attacked iran today you'd have $200 oil in a matter of days if not less. im just saying with or without that its going there in the next 10 years

 

[danibbler]

what I mean is they are very close to the largest potash markets in the world. potash from saskatchewan has to be shipped by boat from much further away. ethiopia has had on average 7-10% gdp growth for the past 10 years, its one of the fastest growing economies in the world. it has a business friendly government which by the way are currently building a railroad for allana potash so allana and other companies can ship their products by rail to the coast to ship by boat. their military is one of if not the strongest in africa, they are a politically stable and business friendly country.

The transit time from Vancouver to Shanghai is about 14 days by boat.

The transit time from Suez to Shanghai is 18 days by boat. Oh yeah, no pirates.

Did you miss the part in wikipedia which said that the mining regions are in politically unstable areas? You do know that Ethiopia and Eritrea are fighting one another at times, right? That's in the same region as where the potash mines are.

http://www.bbc.co.uk/news/world-africa-17433871

There are Ethiopian plans to develop potash mines in the remote Danakil depression, near the border with Eritrea, with the help of the Canadian firm, Allana.

This would require building a railway from the Djibouti port of Tadjoura to the mines and the redevelopment of the port itself.

Allana reported earlier this month that it had received indications of investments worth $600m from investors in the project.

Ethiopia is keen for the development to take place, but is determined to ensure that it is not attacked by Afar rebels operating in the area.

Following the end of the border war in 2000, relations between Ethiopia and Eritrea have remained tense, with both countries supporting each other's opposition movements.

 

[danibbler]

the u.s. govt is wrong just like how they are always wrong when predicting future deficits and federal debt. I showed that link just bc it shows the u.s. govt sees a possibilty of it happening. but anyone else can just do a search of their own for other examples in the media. there are many experts calling for $200 crude in the next decade. people like jim rogers, peter schiff who have better track records than any mainstream economist that works for RBC or whoever. I mean if israel attacked iran today you'd have $200 oil in a matter of days if not less. im just saying with or without that its going there in the next 10 years

So, it's wrong if it suits you but right when it backs up what you're saying?

 

[danibbler]

Did a bit more reading about that potash play and in conclusion:

- the potash mines are being developed.
- the stuff needs to be transported over a non-existent railway to a supposedly soon to be upgraded port in another country
- said country seems to be at war at times with its northern neighbour
- stuff has to be shipped through pirate infested seas to final destination in a transit time longer than stuff from Canada

Right...ok, anyone else going to Macau with me later this year?

 

[msog87]

Did a bit more reading about that potash play and in conclusion:

- the potash mines are being developed.
- the stuff needs to be transported over a non-existent railway to a supposedly soon to be upgraded port in another country
- said country seems to be at war at times with its northern neighbour
- stuff has to be shipped through pirate infested seas to final destination in a transit time longer than stuff from Canada

Right...ok, anyone else going to Macau with me later this year?

there are risks in business everywhere, so I don't see your point. thats like saying india is a bad place to invest because pakistan could nuke them, yeah shit happens. ethiopia is a stable country. meanwhile you have the EPA running wild in america along with the federal govt, to me america is more of a riskier place to invest than ethiopia. what if the ndp get into power in the next election here? are they business friendly? allana will be a small player in the potash business, they can ship their product anywhere farming is worldwide. brazil is another big player inbthe market and they are far from asia. basically it doesnt god damn matter we are in a global economy. the port of djibouti is where they are going to ship from, its located right at the crossroads of one of the busiest shipping routes in the world

 

[danibbler]

there are risks in business everywhere, so I don't see your point. thats like saying india is a bad place to invest because pakistan could nuke them, yeah shit happens. ethiopia is a stable country.

LOL! Pakistan nuking India is a possibility with a low probability.

Are the mines to be developed? Yes, that's a fact.
Does the stuff need to be transported over a non-existent railway to a undeveloped port? Yes, that's a fact.
Does Ethiopia go to war and does it have troops elsewhere such as Somalia? Yes, that's a fact.
Are there pirates on the long sea voyage to China? Yes, that's a fact.

Why don't you tell us why we should not invest in a Canadian company such as PotashCorp?

 

[msog87]

LOL! Pakistan nuking India is a possibility with a low probability.

Are the mines to be developed? Yes, that's a fact.
Does the stuff need to be transported over a non-existent railway to a undeveloped port? Yes, that's a fact.
Does Ethiopia go to war and does it have troops elsewhere such as Somalia? Yes, that's a fact.
Are there pirates on the long sea voyage to China? Yes, that's a fact.

Why don't you tell us why we should not invest in a Canadian company such as PotashCorp?

yes, the mine need to be developed but unknown to you the company has solid investors and is actively recruiting money is basically a non issue thats how solid the company and their assets are, the estimated cost to build the mine is 700 million which is cheap by industry standards, its a shallow deposit and a high quality deposit. You should also know that one of the largest natural resource firms if not the largest BHP also have a potash deposit in ethiopia, they are investing in the country as are other companies. the railroad is being built as we speak the govt of ethiopia is funding the project to support their growing economy. ethiopia has had peacekeepers in a few countries, they have the strongest military in africa and currently have troops in somalia. do you know how much goods from all over the world is shipped through the horn of africa? why do you think there are pirates? many boats now have armed security, and there is a nato presence. look obviously with an up and coming company there are risks, but the trade off is you get to buy undervalued shares. I never said potash corp was a bad investment, but when you compare the upside potential there is no comparison. I have recommended him 3 companies. and have made it clear that even if 2 of them fail which is very unlikely, he will still have alot more money than he currently has now. this is bc the returns will be over 1000% per company. he can put all his money into potashcorp and if hes very very lucky he'll double his money in the next few years. btw allana also has a deposit in brazil

 

[danibbler]

yes, the mine need to be developed but unknown to you the company has solid investors and is actively recruiting money is basically a non issue thats how solid the company and their assets are, the estimated cost to build the mine is 700 million which is cheap by industry standards, its a shallow deposit and a high quality deposit. You should also know that one of the largest natural resource firms if not the largest BHP also have a potash deposit in ethiopia, they are investing in the country as are other companies. the railroad is being built as we speak the govt of ethiopia is funding the project to support their growing economy. ethiopia has had peacekeepers in a few countries, they have the strongest military in africa and currently have troops in somalia. do you know how much goods from all over the world is shipped through the horn of africa? why do you think there are pirates? many boats now have armed security, and there is a nato presence. look obviously with an up and coming company there are risks, but the trade off is you get to buy undervalued shares. I never said potash corp was a bad investment, but when you compare the upside potential there is no comparison. I have recommended him 3 companies. and have made it clear that even if 2 of them fail which is very unlikely, he will still have alot more money than he currently has now. this is bc the returns will be over 1000% per company. he can put all his money into potashcorp and if hes very very lucky he'll double his money in the next few years. btw allana also has a deposit in brazil

They have enough money for two years according to their presentation. That means that they better produce on time or else they go broke.

A lot of the money for infrastructure development comes from Chinese banks...good luck with that.

Re: BHP, they are rumored to be getting out of Ethiopia:

http://blogs.wsj.com/dealjournalaustralia/2012/06/18/bhp-silent-on-ethiopian-project/

Re: Ethiopian troops in Somalia, no, they are not peacekeepers. They've been on the ground fighting Islamist rebels for years.

Re: pirates, do you have any idea how big of an area the couple of dozen ships from NATO and elsewhere have to patrol?

Re: Allana, no, they do not have a deposit in Brazil, they have some land to explore in Argentina.

 

[msog87]

They have enough money for two years according to their presentation. That means that they better produce on time or else they go broke.

A lot of the money for infrastructure development comes from Chinese banks...good luck with that.

Re: BHP, they are rumored to be getting out of Ethiopia:

http://blogs.wsj.com/dealjournalaustralia/2012/06/18/bhp-silent-on-ethiopian-project/

Re: Ethiopian troops in Somalia, no, they are not peacekeepers. They've been on the ground fighting Islamist rebels for years.

Re: pirates, do you have any idea how big of an area the couple of dozen ships from NATO and elsewhere have to patrol?

Re: Allana, no, they do not have a deposit in Brazil, they have some land to explore in Argentina.

allana is one or two steps away from starting construction, they have their feasibility study coming out this year which is basically the last step. if BHP leaves thats better for allana, there are many reasons why BHP could be leaving I can tell you its not political risk which is probably the greatest importance to a company. do you know how many mining firms operate in africa? you keep going on about ethiopia being high bc it has troops in somalia how about mexico? its like the wild wild west over there with mass killing and basically an all out war with the army vs drug cartels and the mining industry is doing very well, mexico is considered one of the best places to operate in the mining industry. 50% of the worlds goods that get transported by boat go through pirate country in the horn of africa. I also recommended he diversify by buying spanish mountain gold and wildcat silver.

 

[msog87]

excerpt from allana's website:

The Ethiopian government is strongly supportive of mining initiatives
in the country. Allana’s relationship with the Ethiopian government is
very strong and will greatly assist rapid advancement of the project.
Ethiopia is the oldest independent country in Africa. The macroeconomic
environment has been stable, experiencing double-digit
growth since 2003. Most major economic sectors have been liberalized.
Government guarantees, as stated in Ethiopia’s Investment Code (1991),
are provided to foreign investors in addition to providing constitutional
protection from expropriation. Ethiopia is a member of the Multilateral
Investment Guarantee Agency (MIGA) and the Convention on the
Settlement of Investment Disputes between States and Nationals of
Other States.

the government wants allana to succeed so badly they are building a multibillion dollar railway so that it is cheaper for allana to ship its product. allana has a NET PRESENT VALUE of OVER 1.8 BILLION, this means once in production market value for the company should be 1.8 billion to be considered fairly valued, right now the market cap aka value of the company is 100 million. so if the OP buys today he could make 18+x his money. now, allana is also talking about doubling the estimated rate of production which means the NPV will go much higher. so you have to ask yourself, is the risk worth the reward. I think its a no brainer as the company is very close to starting mine construction this is a winner folks.