It's a challenging day for U.S. stocks, with the Dow Jones Industrial Average (^DJI -1.24%) and the S&P 500 (^GSPC -1.46%) down 1.32% and 1.19%, respectively, at 11:45 a.m. EDT.


Shares of BHP Billiton plc (ADR) are down 0.78% at 11:45 a.m. EDT after a filing with the Australia Securities Exchange revealed that BlackRock is no longer a significant shareholder. BlackRock had been the miner's largest owner, with a 10.1% stake.

BHP Billiton's other listed shares, BHP Billiton Limited (ADR), are down 0.43% at 11:45 a.m. EDT; they're in danger of putting in a new 52-week low.

A dual-listed company, BHP Billiton Group's structure is unwieldy. BHP Billiton Limited has its headquarters in Australia, which also serve as group headquarters; shares trade on the Australian Securities Exchange. BHP Billiton plc is headquartered in the U.K.; shares trade on the London Stock Exchange.

Both companies have the same board and management team, and shareholders of each company have the same economic and voting interest in both companies.

BHP Billiton was the top holding in BlackRock's World Mining Trust plc, which is co-managed by veteran commodities investor Evy Hambro. Hambro, who is a descendant of the eponymous banking dynasty, is also chief investment officer of BlackRock's well-respected Natural Resources team.

The news is unnerving, as Hambro is known to favor companies with high-quality assets, low-cost operations, and moderate leverage, and BHP Billiton fits that profile.

Four years ago, Hambro told Bloomberg:

We are buying these assets well below their replacement cost and over three, five, 10 years, we think they are going to do very well. We've got to an unrealistically low point in valuations relative to what's going on, but that doesn't mean that the risk of what's going on is low.

One deflating commodities "supercycle" later, and his World Mining Trust has lost two-thirds of its value and is underperforming his benchmark, the Euromoney Global Mining Index by three percentage points (price basis).

There's no two ways about it: Plummeting commodities prices have impaired business values. However, it now seems reasonable to ask whether the fall in corresponding equity prices does not overstate the damage.

With a year left to run, Hambro's five-year prediction looks doomed, but the outlook for his 10-year timeframe is a lot healthier. We may not have reached the low in miners' stock prices, but they look cheap enough to begin buying, albeit selectively. BHP Billiton is a great candidate -- I'd rather take the other side of BlackRock's trade.