NOTE: The transcript of the audio recording was cleaned up for easy reading. This was my first interview, ever. To listen to the original recording (19:49 minute length) click here.
@Vaughan: Welcome everyone to @Vaughan discovers, a news series dedicated to uncovering interesting users of CEO.CA, the professionals in the junior markets and companies in the speculative junior markets. I'm your host Christopher Vaughan, I am the community moderator at CEO.CA and I post under the handle @Vaughan.
Today I have the pleasure of speaking with a longtime supporter of CEO.CA: Nick Germain.
Nick posts regularly under the handle @MiningBookGuy. He has created several channels channels on our site and he has become a go to source for discussions on mining in Africa. @MiningBookGuy. Welcome and thanks for joining me today.
@MiningBookGuy: @Vaughan. Thanks for having me. I'm honored to be one of your early guests.
@Vaughan: I'd like to give you and our listeners a general roadmap of what we will be covering in this new series. My intention is to cover three main subject areas: 1) your personal and professional background; 2) for you to give some thoughts on the junior markets; and finally your use of our platform at CEO.CA. So with this in mind let's dive right in.
Could you say a few words about yourself? who are you, where do you come from. What's your background?
@MiningBookGuy: Sure. So you know I like to describe myself as an independent speculator or investor. And I did dabble in the markets back in the mid 2000s kind of at the end of college, right around when I was graduating. And I think it's important that I had success as a video game entrepreneur and in Facebook games after having a lot of other issues kind of doing my own thing. But that independent streak was always there. And what's important is that I really enjoyed doing things independently and as that company grew, I actually enjoyed it less and I was kind of looking for a new thing.
And interestingly you know junior markets and speculators can always be an independent area. So there are parallels there. I treat this as being very entrepreneurial. And so yeah, outsider/entrepreneur/investor/speculator, that's that's what I've been doing the last 10 or 15 years.
@Vaughan: So how long have you been investing in the junior resource market?
@MiningBookGuy: Well that's good to get into specifics because at first I got interested in resources through precious metals like gold and silver right at the top, you know 2011, 2012. Terrible timing there and I'm very thankful I didn't discover miners until a year later and then the junior market until closer to 2013, 2014. So it's been about five years that I've really been involved in the smaller junior space and now it consumes all my time.
@Vaughan: What types of companies in this space do you spend the most time evaluating? Do you focus your energy on a certain stage of company for example exploration, or development, or the producers? and why do you focus your energy there?
@MiningBookGuy: Yeah so, I went down the food chain as I got into the junior space, you know producers first and then I looked at developers and now I spend most of my time on explorers. And this will be a theme of our conversation here but there are more inefficiencies the lower on the food chain you go, especially to the smallest market caps like less than 20 million or less than 10 million. And I've also gravitated to not having to worry as much about the macro space and realizing that focusing on explorers that can make a big discovery in any commodity, the price of the commodity doesn't matter as much. Through the help of having had a full service broker I was able to realize that I could understand and evaluate exploration. And again, it's very inefficient because many other speculators don't. So I'm very heavy on the exploration side now.
@Vaughan: As you mentioned there are lots of inefficiencies in this market. One question I have for you is what's your edge when investing in this space? Considering there are all these inefficiencies, what is it that you bring personally that makes you feel more confident in your ability to pick stocks correctly as opposed to someone else?
@MiningBookGuy: So CEO.CA is very much at the center of this. I think using the platform made me realize what are the areas that other people tend to not focus on. And a big part of that is looking at 'exotic', I like to call them 'exotic' jurisdictions. Of course there's different risk spectrum for where you look in the world but I think there's a huge gap in perception and reality and many of these jurisdictions. Africa has been a focus for me because it's such a huge continent with dozens and dozens of countries and they're not all the same. And so I can do independent research following these countries and then using a site like CEO.CA and talking to experts in the field to understand geology. I can provide my own spin with geopolitics and kind of put the pieces of the puzzle together because there are no professional analysts that cover these companies. It's already rare for professional analysts to cover micro caps and then and it's even rarer for anybody to cover companies in any jurisdiction or jurisdictions that aren't in obvious places like the U.S. or Canada. So that is a huge thing. And I consistently find great value and great edge looking in that way.
@Vaughan: For new investors in the space who are just getting interested as of late, what advice would you have for these people starting out when looking to invest in the juniors? What lessons have you learned that you would like to share?
@MiningBookGuy: I think a really good lesson is to be very careful about following hype driven stocks. There's like mini manias that appear over and over again. People wouldn't do it if they didn't make money that way. There are always people making money riding a hot stock. But, I say be extremely cautious there because it's the most common reason for people to lose all their money. And also, even if you're following that, it doesn't mean you need to put all your eggs in one basket but that's what people tend to do. Using CEO.CA, it's amazing how consistently you can find these hype driven stocks whether they're in the mining space or the crypto currencies or weed or whatever is hot. I'd say that be cognizant of that and you can make a lot of money doing things very differently from other people and you're sticking with looking at value we're looking at things that are unloved. That's my advice. But there's a lot of ways to make money. But I'd say be very cautious about anything that's hype driven.
@Vaughan: I agree. I've learned that through CEO.CA that you can identify common trends and patterns in these plays that have saved me a lot of heartache in my investing experience.
@Vaughan: Now you've been mentioning CEO.CA quite a bit so let's turn to CEO for a second. How long have you been using CEO and how did you first come across the platform?
@MiningBookGuy: I really got interested in the juniors maybe a year to a year and a half before CEO.CA existed. I believe I joined CEO just as a lurker, just kind of following other people within a month or two of when it started. I believe this was right around the beginning of 2015 and still in the bear market. Honestly it's a little fuzzy. I was thinking about it, 'How did I discover CEO?' I know I saw some interviews with Tommy Humphreys somewhere, he was on social media before this, and I think I had looked at StockHouse and I wasn't very happy with that site. And then I was like 'oh, there's another new site called CEO.CA!' It was neat to be involved back then and to know that they're lucky to have 50 active people in one day. I just want to point out it was very valuable to me even though I was only lurking for the first six months. I literally read everything on CEO.CA in the first half of 2015 until I finally started using it, posting, I think in September of 2015.
@Vaughan: How does CEO.CA factor into your investment decision making process? You mentioned how there are certain pitfalls, certain "hype" type of companies that you tend to see surface through social platforms and it becomes very clear what's happening, at least in retrospect. Does the CEO platform factor deeply into your decision or do you use it more as a place to discover names you have never heard of before?
@MiningBookGuy: So I'll spend a little more time with this answer going through some examples. And I think what's neat is that as of recording today there is a small African explorer called Awale Resources. The ticker is $ARIC on the TSXV, and I want to use this as an example because that's exactly what I'm trying to do right now over and over again. It's a company I started following on CEO.CA maybe two years ago. I think it was spun out of Marianna Resources and it was always on my watch list.
With CEO.CA you can have these watch lists that news comes out in real time and you can see if people react to the news and no one talked about the stock, maybe barely talked about it the whole time. I think I had a few posts and a few other people too. And I didn't think about it for months and then all of a sudden today they make a gold discovery. I saw it right away and that was interesting in itself because I don't don't need to buy the stock but I can immediately look at the news through the site and be like "oh this is a true greenfields discovery, these are some nice drill holes" and I look at the recent history, and again, nobody really talked about it over the last month or two. Interestingly, I oftentimes won't post anything right away because I want to buy for myself and in this case it's a very illiquid stock. I also have #CEOPro to help me out, a little plug for that because it really does help a lot to know the trading patterns and I know that there's very little volume and nobody was putting bids out there. I like to build credibility to a degree on CEO and so I have the first post after the news. I was able to buy a tiny amount of shares at .10 cents, right at the open. But what's cool is as of right now, it might come back down but I think it's .16 cents. Wow, you know there you go, 60% gain on my small amount of shares there! What's really interesting too is that very few people posted after me in the first hour. But then one of my friends and one of the influencers @stateside, he makes a post and all of a sudden in the Awale room it went from like maybe three or four people to what I'm seeing right now 20 people in there. So you can see all these different factors fit in together and it's so fun, because even if I don't make that much money from this it's still a neat process. It keeps you on your toes and it's so neat to see companies that no one follows, don't get attention, sometimes it can take months and months. In this case it literally took a couple hours and so we'll see where this goes from here and I'll probably make a little bit of money but it's not just about making money.
I was going to just add a couple other things here. You know this worked for previous examples, a really good example that's getting a lot of attention now is Osino resources which is $OSI on the TSXV and nobody really followed that last year. I made a lot of post, there were a few other people too. That's one that's taken longer to develop, but they've made a real discovery and it's very active on CEO.CA right now and I really enjoy that.
Then one more, Mundoro, $MUN on the TSXV. This one's interesting in a different way because it's gone through cycles of having attention and not having attention. What I really love right now is that I own shares in this one and I have traded it successfully, though I don't really enjoy trading it necessarily. But I can kind of tell when things build up or they don't, but it's actually moved up more the less people talk about it. That's kind of neat to see . It went from .10 cents to .16-.165 cents in the last month or two. Those types of patterns I love and the less people talk about it while good things are happening in these stocks the more I tend to like stocks.
So that was a rant with a few different examples. We can see there's all these neat factors if you follow CEO.CA on a regular basis, even better if you have #CEOPro where you can really get that edge.
@Vaughan: I agree with you. I have #CEOPro as well and I've found that since getting it I no longer feel like I'm boxing blind. I can see exactly how liquid or illiquid a stock is and not some common mistakes, like trying to do market orders or trying to fill a position without really seeing what's happening in the market.
You also mentioned another user on CEO.CA so I'll ask this next next question: Have you used CEO for networking? Have you made serious lasting connections on the site and how have they proven valuable to you?
@MiningBookGuy: Yeah I'll go through a few examples here. Well I have to say I've got people that have become friends, like good friends. Examples of that are @TheNextBigRush (Fabi) and @JayFire (Jay). These are two people I never would have met if they didn't post on CEO.CA and I remember I reached out to both of them because of posts there. We kind of hit it off independently. Just to tell you how far it's gone, when Fabi lived in Winnipeg, I drove up to Winnipeg from Minnesota to see her for a weekend and that was really cool. We've stayed in touch since then talking about stocks but other things too. I actually saw Jay over in Japan of all places, a few years ago we just happened to both be there! So you know those are good friends. But when it comes to conferences I never went to conferences before CEO.CA, and I think it's worth mentioning the Metals Investors Forum is a really cool place, mostly in Vancouver sometimes in Toronto, and I've met a lot of CEO.CA people through there.
I think just as a stand out @EvenPrime was a really cool guy to meet. Even the London one to one that just happened to be going on right now. I'm not there this year, its going to start this week but it was very cool to meet @KevinS from Ireland, @FundamentalAnalysis from the U.K., and a bunch of other European people. We actually had a little bit of a CEO.CA get together. I just wanted to provide that because it is very global as well. It's been immensely valuable to meet people in person who I first came into contact with on CEO.CA.
@Vaughan: We do have a large and diverse community at CEO.CA spread across the globe. Of course we have a strong presence in Canada, but I too have benefited from being able to go to those shows and meet the different users. Put faces to names. In fact that's kind of where I came up with the idea for this series, to give if not a face at least a voice to the name and to the handle.
One last question I have for you is: Aside from the usual names, the usual suspects, the most followed list on the site, are there any hidden gems in the user base? Users not widely known or followed but have provided great discussion and debate for you personally?
@MiningBookGuy: I will mention one who is fairly well followed but I'll tie it in with some people who are less followed. @Excelsior: He is on the higher follow list but I feel like he deserves so much credit for using CEO.CA 'the right way'. @JGMS: He is less followed but I think in the same vein as @Excelsior. What's really important is they use tagging so well and watch lists so well. I think that it's really worth emphasizing that I would love to see more people using the site the way they do: tagging companies, tagging people, tagging ideas etc. I like to do that as well and so I really like to follow what those guys have to say. You know @JGMS, he's one that's kind of up and coming and there tend to be people like that, they just kind of appear. Sometimes they provide stuff you don't expect, like talking about more ASX companies, or talking about other parts of the world that most people aren't aware of. I'd love to see more people tagging and doing watch lists like they do and they're definitely must follows.
@Vaughan: Well @MiningBookGuy, thank you for taking the time to talk to me today and I look forward to continuing to follow you and your posts on CEO.CA.
To our listeners (readers) I'd just like to say: as always, good luck out there. Thank you.
@MiningBookGuy: Thanks for having me @Vaughan
Nothing in this interview is to be considered investment advice. All future oriented expectations of Nick Germain (@MiningBookGuy) may not materialize. Always do your own due diligence prior to making investment decisions. Christopher Vaughan does NOT own shares in any companies mentioned in this interview at the time of publishing and may choose to buy at any time without notice. Christopher Vaughan shall not be liable for any damages, losses, or costs of any kind or type arising out of or in any way connected with the use of this video. You should independently investigate and fully understand all risks before investing. When investing in speculative stocks, it is possible to lose your entire investment.