Being a value growth investor, I’d recommend a stock that has a strong margin of safety—thus little chance of permanent capital loss—while also having huge upside coming from market recognized or unrecognized catalysts.
There are some investments out there where the potential loss is total while the potential upside is extremely high. I wouldn’t call these investments, and only would recommend one as it’s more like a bet.
To keep things interesting, today I want to share with you such a bet by discussing a non-linear stock with out of the box thinking management, McEwen Mining (NYSE: MUX). MUX will give you a clue as to how I research potential investments and analyze their risk reward ratios.
MUX is a producing, developing, and exploring gold/coper miner. Currently, it produces only gold, so the market puts it into the gold miners basket. Nevertheless, it has 3 producing mines in Ontario, Mexico, and Argentina, two gold mines in development, and various exploration targets. More →