HAPPY NEW YEAR!

We at calichebahada.com would like to wish everyone a healthy, happy and very prosperous new year!

The year past was, to say the least, interesting. The volatility was tumultuous and at times gut wrenching, especially in the junior market. We expect the coming year to be just as exciting, with the headlines always looking for bad news, either in Europe or the upcoming American elections, looming action in the middle east.

We expect commodity prices to regain the upward momentum and make new highs. Gold and silver will continue the bull market, since nothing in the world has really changed and Europe will inevitably print, after all the political BS has run its course.

We, despite the volatility, have booked out best year yet in 2011. We have abandoned the diversify approach to reducing risk since in a market downturn even giants can be crushed, you know the names GM etc..

We have found that sticking with companies and management we know well and overweighting in situations as they develop, reducing risk has been the best way to survive the crazy markets. Jesse Livermore said it best, “be right, sit tight.” The daily noise is suddenly removed. If one of our stocks is down we endeavor to add to our position since we know fundamentally nothing is wrong with the company. We do not advocate this approach to anyone since we are extremely risk tolerant and can if the need arises be nimble and re evaluate situations on a minute by minute basis.

2011 was a great year for me personally and as a trader. I was married this year and, was fortunately able to retire from my day job and concentrate on the markets, a dream of mine since highschool. I feel I have matured and hit my stride finally learning the important lesson of selling losers and overweighting winners. It sounds easy but it is really one of the hardest things to do, accepting a loss. I endeavor to also have cash available to take advantage of weakness in the market, haven’t mastered that one just yet! LOL

Our top pick last year was Newstrike Capital, it is also our top pick this year! We don’t have a weekly pick or a top 10 monthly, we look very hard at companies we invest in and not many make the cut. We firmly believe that quality trumps quantity. The richest guys I know have only made a few big bets and rode them to the top!

We are grateful to Richard Whittall and the management at NES, they truly are some of the best and brightest we have come across in our 25 years investing. There is no one better to explore the GGB than the team at Newstrike.

We have just finished the first chapter in the Newstrike story. The initial high grade discovery has really set this stock apart from any other I see working a property now. The second (really third if you count the low grade Goldcorp found) discovery 1 km to the southwest has really blown the doors off of even our expectations and has been given zero value in the market. I think Gillian and Craig are on to something down there that is just as exciting as the breccia.

We have taken advantage of the year end selling to bulk up our NES positions and hold it in all of our accounts. The upcoming 43 101 will really light a fire under the share price as it will spell out the significance of what we have found to the un initiated. There are many back of the napkin calculations being done by those that know what we have and believe me they are simply amazing. After only one year of drilling the NES team has discovered another 2 major deposits in the GGB!!

Please take a look at Newstrike Capital, it will most certainly be one of the winners in 2012! We are overweight and expect it to outperform the market by a massive amount.

Our top 5 holdings

Newsrtike Capital NES
Teuton Resources TUO
Atacama Minerals AAM
Calyx Bio-Venture CYX
NGEX Resources NGQ

Please accept my heartfelt best wishes for the upcoming year, and as always happy investing!

Please do not accept anything seen here as investment advice.  Please seek the council of an investment professional and tax advisor before making any investment decision.  Calichebahada.com is for informational purposes only and will not be held responsible for any losses incurred in these or any stocks mentioned 

January 1st, 2012
Categories: Uncategorized . Author: caliche