With silver prices joining gold in a fresh round of strength, it's becoming hard to identify a silver investment that is not bound to yield impressive returns for investors through the next phases of this precious metals bull market.
That's not to say that investors are advised to pick their silver plays by placing names in a hat, but the strength of the sector at large certainly makes it easier to pick a winner.
Bobbing for silver
At the brand new 52-week high for Silver Wheaton
Record production at the aptly named Lucky Friday mine, with associated strength in the production of cost-reducing by-products like lead and zinc, led Hecla to swing from a $12.4 million adjusted loss in the prior-year period to a first-quarter profit of $17.2 million. Hecla is targeting 2010 production of more than 10 million ounces of silver at a still-amazing cost of less than $2.25 per ounce.
Coeur d'Alene Mines
Mining access has now been restored at San Bartolome, 109,000 of gold production is expected from Palmarejo this year, and the looming Kensington start-up places Coeur d'Alene prominently among the top-tier opportunities in a crowded field of standouts.
Basking in the shadows of relative obscurity, Pan American Silver
In the first quarter, the miner raised silver production 13% to 5.5 million ounces, increased gold volumes a full 34% and lowered cash costs 27% to just $4.35 per ounce. Net income surged 189% year-over-year, while mine operating earnings rocketed 252% higher, to $36.9 million.
Despite a noteworthy surge in share prices recently, I still consider Pan American one of the deepest values anywhere for a growth-focused, high-quality silver producer.
Too many winners to choose from
If you can't make up your mind between choices like the fixed-cost beauty of Silver Wheaton's unique silver stream model, the overlooked value of producers like Coeur d'Alene and Pan American, or the insanely low costs of a Hecla or Silvercorp ... then how about just picking them all.
Thanks to a pair of very compelling exchange-traded fund (ETF) offerings that provide convenient exposure to a wide range of high-quality producers, Fools no longer have to buy up shares in multiple stocks (as I have done) to attain the benefit of spreading out operational and geographical risks that are inherent to the mining industry. If you believe, as I do, that the continued ascent of gold and silver prices will serve as a rising tide that carries most mining shares to remarkably higher prices, then these two ETFs may be just the kind of rafts to climb into.
Don't let the name fool you: The Market Vectors Junior Gold Miners ETF
With all five of the aforementioned silver standouts firmly entrenched among its primary holdings, the newly launched Global X Silver Miners ETF
Let's see if I can convey just how strongly I feel about the performance potential of this investment vehicle: Of the 25 stocks presently listed among its holdings, I personally own 16 of them. Accordingly, I have added the ETF to my silverminer CAPS portfolio and marked it as one of my very top picks. I invite you to join me in the CAPS community and let this pick boost your own portfolio's score.
I'll take it one step further and record my bold prediction here and now: This ETF will outperform the benchmark S&P 500 by at least 200% before I close my CAPS pick within the next five years. Please vote in our Motley Poll, and let me know what you think of my prediction in the comments section below.
Gold is a hot topic on the blogs at Motley Fool CAPS. Join the free service today and see just how many Fools are taking the long view when it comes to investing in gold. The "Gold" tag at CAPS lists 52 potential investments, and you'll find Christopher's comments on most of them.
Fool contributor Christopher Barker carries a silver coin that reads: "Honest value never fails." He can be found blogging actively and acting Foolishly in the CAPS community under the username TMFSinchiruna. He tweets. He owns shares of Coeur d'Alene Mines, Hecla Mining,Market Vectors Junior Gold Miners ETF, Pan American Silver, Silvercorp Metals, and Silver Wheaton. The Motley Fool's disclosure policy is 0.999 pure.