What you must know before buying most mining stocks today

From The Gold Report:

It may look as if almost any mining stock you see these days is a bargain just waiting to be plucked. While most stocks have seen major drops from their highs and some are showing significant price turns, others have more downside left and a few just won't make it to the next market peak. Ivan Lo, publisher of The Equedia Weekly Letter, takes both a macro view of market and economic conditions and then carefully studies the specifics of each stock he decides to follow or acquire. In this exclusive interview with The Gold Report, Lo talks about the critical factors that can separate a mega-winner from a rollback candidate and talks about some of his favorite names.

The Gold Report: Your newsletter, The Equedia Weekly Letter, talks mainly about Canadian companies you actively own. Why did you begin writing this newsletter and how do you choose the companies you invest in?

Ivan Lo: I've always been interested in the capital markets because they are the source of the world's growth. Without them there wouldn't be Google, Microsoft or Apple. My father was editor-in-chief of a prominent global newspaper, so I guess that's where I combined the two ideas. There are some extremely able men in our industry and I get to have some great discussions about investment philosophies, strategies and market outlook. We often trade ideas and go through what works and what doesn't.

These brilliant men don't think like the average person; their thought processes are often beyond that of the average investor. That's how The Equedia Weekly Letter got started. I wanted to bridge that gap and turn complicated investment philosophies into something simple that everyone could understand, from macroeconomics to mining 101. My job is to make it simple and start with macroeconomics, the big picture. For example, I believe the precious metal sector is undervalued right now.

First, I'll look at the project. Does it have value or is it just a crapshoot? When it comes to mining, drill results alone aren't enough. A company...

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