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Buying & Tracking Canadian Silver Stocks

Silver Stock Report

by Jason Hommel, Oct 19, 2003


    The United States Government has placed restrictions on US mining companies that destroyed almost the entire US industry of precious metal exploration penny mining stocks. This is in part what helped to open up trading in Canadian mining shares. I don't know what the regulations were, and it was before my time, but that's what I have read.

    There are also restrictions on US investors. The "Federal Reserve Notes" we own are not ours to do with as we like. US investors cannot buy Canadian mining stocks through US brokers--as far as I'm aware. We have to use international brokers, or Canadian brokers in order to buy Canadian stocks. A US investor can open up an account with a Canadian broker, and trade directly on the Canadian exchanges.

    One way around this limitation is through trading the "pink sheets" (PK) which are available for US investors who do not have a Canadian broker. Most Canadian shares also have a symbol for trading on the "pink sheets" (PK), which quotes the price in US dollars, instead of Canadian dollars. When buying a PK stock symbol, your US broker actually buys from another broker who does both a currency conversion for you, and he buys the stock on the Canadian exchanges, and he will charge an additional commission for both services, which tends to be about 1-3% in my experience. Unfortunately, the quotes for the PK shares are often updated a day later, or not updated for a few days. And there is no volume published, nor a bid and ask to get quotes on the PK shares.

    This does not mean there is no volume in the stock, and this does not mean you cannot get a bid and ask. The stock trades in Canada, and the volume, and bid and ask are on the Canadian exchanges, and you can get all this information at yahoo.com for free, very easily, by looking up the quote for the Canadian symbol. The quote for a ".V" or ".TO" stock is in Canadian dollars. To translate this to US dollars, you have to look up a currency conversion chart, and multiply by about .77 to get the dollar price.

    (The Canadian/US exchange rate has been changing a lot lately. Six weeks ago, it was .73. I wonder if all the people buying Canadian stocks has had a significant effect? Anytime you go to buy a Canadian stock, you are selling dollars, and buying Canadian currency just before you buy the stock. So this puts increased downward pressure on the dollar, and upward pressure on the Canadian currency.)

    When placing an order for a "pink sheets" (PK) stock, you should also add about 1-3% for the commission, or more if the stock is tightly held, to help make sure your limit order is filled. Or, you can just use a market order. I strongly advise against placing market orders before the market opens, as sometimes stocks can "gap up" and you won't know what you are paying, especially if a lot of market orders are placed at once during the night if an article comes out on the internet.

    Not all US brokers even deal with PK stocks, so here is a convenient list:

    Brokerages for investors in the USA that handle Canadian issues and/or pink sheets:

    www.ameritrade.com Internet, $10.99; Telephone System, $14.99; Broker-assisted: $24.99 Market orders, $29.99 Limit orders.

    www.penntrade.com online trading, $29.95/trade. no extra charges for market orders, limit orders, large volume, small volume, stocks under $1.00, or Canadian, Pink Sheets, or OTCBB. (Get started with only $500!) www.pennaluna.com --for broker assisted trades, starting at $45/trade.

    www.gril.net Global Resource Investments LTD.. "They appear to be very knowledgeable in the field and all their brokers are out of the mining industry."

    www.aftrader.com --only $10 in and $10 out. No extra fees. You buy the Canadians PK or OB.

    www.etrade.com

    www.scottrade.com "will buy Canadian stocks cheap."

    To track the price of your Canadian silver stock, you don't want to look up the price for the PK share, because the brokers do not update them frequently, and when they do, the information is a day old at least. The Canadian symbol quotes in Canadian dollars, and the PK symbol quotes in US dollars. Therefore you have to convert the updated Canadian quote price to US dollars on your own.

    Click on yahoo finance. Take a minute to register. Sign in. At the top of the page, click "create" a portfolio. Choose "track your current holdings". In the large box, copy and paste the following symbols (Use your mouse to highlight the text, then use control-C to copy, control-V to paste).

    XAGUSD=X BHP GMBXF.PK HL IPOAF.PK CDE GRS GAM.TO MFN MFL.TO SIL FSR.TO MR.TO METLF.OB CZN.TO CZICF.PK PAAS MAN.TO MMALF.PK WTZ WTC.TO MGR.V MGRSF.PK GQM.TO GQMNF.PK CFTN.PK KBR.V TM.V TUMIF.PK SSRI ADB.V SVL.V STVZF.PK DNI.V MAI.V MNEAF.OB ECU.V ASM.V ASGMF.PK SRLM.PK EXR.V EXPTF.PK FAN.TO FRLLF.PK MNMM.OB UNCN.OB IMR.V IMXPF.OB VGZ VGZ.TO MCAJF.PK CDU.V CUEAF.PK MAG.V TVI.TO TVIPF.PK MMGG.OB EPZ.V ESPZF.PK IAU.V ITDXF.PK NPG.V NVPGF.PK HGM.V NJMC.OB MMG.V MMEEF.PK QTA.V QURAF.PK EXN.V GNG.V SPM.V SHSH.PK ROK.V HDA.V ITRO.OB III.TO IPMLF.PK EZM.V EZMCF.PK MTB.V MSLM.PK MAR.AX RRM.V SBUM.PK FWGO.OB MEMLA.PK SLSR.PK SDSI.PK HRNS.PK GPXM.OB TUO.V TEUTF.PK HGM.V HOGOF.PK GSPG.OB AAG.V ANMCF.PK MVRM.OB

    The first symbol, "XAGUSD=X" lets you track the silver price. These symbols are in the exact order they appear in my weekly silver stock report, so this way, you can follow along what's taking place in the silver market on a daily basis. Also, you can easily access charts for any of these, such as 1 day, 5 day, 3 month, 6 month, 1 year, 2 year, or 5 year charts. You will love being able to access this information so quickly from your own continually updating "silver stock page". You will also be able to see, in one place, right at the end of the list, the news releases for each stock on the list (if the company has their PR act together).