Free Gold?

Mining has a risky image (see above). But risk is always a function of price. At today's price, you can safely get exposure to what is essentially free gold. At the likely market price, you can hang on for the next year or two to capture upside optionality related to gold recovery or a sale of the company. There is next to nothing to lose and multiple ways to win. Such a relationship between risk and reward makes for an investment that is, of all things, safe.

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Disclosure: The author is long PZG.

Additional disclosure: Chris DeMuth Jr is a portfolio manager at Rangeley Capital. Rangeley invests with a margin of safety by buying securities at deep ...

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