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Disclaimer:

Please read our full disclaimer by clicking here​​​​​​​.  Statements regarding the Company which are not historical facts are "forward-looking statements" that involve risks and uncertainties. Such information can generally be identified by the use of forwarding-looking wording such as "may", "expect", "estimate", "anticipate", "intend", "believe" and "continue" or the negative thereof or similar variations. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements due to factors such as: (i) fluctuation of mineral prices; (ii) a change in market conditions; and (iii) the fact that future operational results may not be accurately predicted based on this limited information to date. Except as required by law, the Company does not intend to update any changes to such statements. Caddy Stocks believes the expectations reflected in those forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included herein should not be unduly relied upon. This article shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

Screenshot from Jeff Clark's Silver Presentation

by Daniel Reid

How To Ride The Coming Silver Stock Mania...The Smart Way

Gold is Back up to $1743/oz. Is There Still Profit To Make? (YES!! But not how you think...)  

Imagine reaching into your pocket and pulling out 3 solid gold coins.  Nowadays that’s close to Six Thousand Dollars in the palm of your hand.  Real money.  


What would you do with it?  Or would you simply appreciate the fact that it’s really in your possession? 


Each and every day there’s a group of people going out and looking for the gold that will eventually end up in those coins in your hand. 


Most people think that investing in gold is just about finding a company that hits the mother lode.  That’s where the action is, and that’s also where there is huge risk.  


Yet what about that in-between trip that gold makes from the ground to your hand?  


What about the companies that make guaranteed returns every year simply by holding a stake in that supply chain?


Wouldn’t it be nice to hear about that kind of investment for a change?   


Supply chain style companies like this will benefit the most from a rising price in gold. 


Why?  Because they don’t have to discover any new gold reserves.  They can simply increase their capacity.  Their profit margins can grow with every dollar move in the gold price.  


Since the beginning of the year we have seen an increase in gold price from $1557 to $1743/oz(10.6%) and 29% in the past year.  Some analysts think that there is still room to move and in the past the price of gold has reached $1900.  


Some analysts predict​​​​​​​ it will reach between $1850 and $2000 this year.  BOA is even saying $3000 could be seen​​​​​​​ in 18 months. 


If gold does reach this years high end $2000, that is an additional 16% above the current price.  That is a modest profit for the year and most people would be happy with that kind of result but there may be a better play.


We have all heard the story of the gold rush days when the prospectors were out panning and barely made anything but the smart men that sold picks shovels and pans became rich. 


Well there are no more pan sellers but Inca One Gold Corp (TSX-V: IO & OTCMKTS: INCAF ) is possibly even better.


Inca is a processor for small scale mines in Peru.  Why is a Peruvian processor a good choice?  There are several reasons. 


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1.  Lowered Risk


The most important is that they are not in the business of prospecting.  They put all of that risk on the miners whose gold they process.  The Peruvian government is now taking a very active role in the mining business and unregulated mines are also being shut down.  Under Peruvian law, artisanal miners must send their ore to licensed processing facilities.  The number of miners registered with the government has grown 22% to an estimated 66,000 with the governmental crack down.  Because IO’s 2 operations are often their only choice, the desert miners must sell their gold at competitive prices allowing a max profit for IO.  IO’s CEO, President and Director, Edward Kelly. says it best, “We do not have any exploration or mine development costs. There is no mining risk to us directly.”


2.  Barriers to Entry


Latecomers to the golden party (aka potential new processor competitors) have high barriers to entry.  They would need to build a government regulation compliant facility.  Next they would need to go through all the red tape of petitioning for a license.  Because of tightening regulations this becomes an ever harder process and potentially impossible if Peru chooses to not allow any further licenses. 


Assuming then a competitor could get past these hurdles, they then don’t have the relationships with the miner suppliers.  So beginning a new plant would have further increased costs to pay lower gold prices in order to steal away IO’s customer base.  Not likely.  As they would probably prefer to stay with a company they already trust.


3.  Environmental Protection and Risk Mitigation


The second reason is related to environmental concerns.  The location of IO’s two processing facilities with their combined 450 tons per day government permitted capacity is in the Peruvian desert.  Other processing facilities have been in the Amazon rainforest, and sadly have a bad history of pollution.  The recently upgraded plants positioned in desert areas neither have to worry about environmental impact problems, nor laws that could come on the books that destroy the profits of other companies.


4.  Vertical Integration


Inca will be opening a bullion store.  This planned vertical integration will bring customers closer to Inca that previously had to buy through a middle man who wanted their profit from the sale as well.  This move will increase the profits for the sale of the gold that Inca is processing.

Inca One:   Current Chart on OTCMKTS: INCAF​​​​​​​.   On Canadian Exchange IO:CN

Aftemath on American OTC:  FLMZF,  Canadian TSX trades under AAG

Summary


The upside with IO has great potential.  It is in a strong position to take advantage of any price increase in gold while also not having a downside that a mining company would potentially be risking. Inca is also very likely a good long-term play with the benefit of its current licensing and lowered risk of any long term environmental problems that other companies could face.