Investor FAQ
Guide to This FAQ
1. Getting Started: Junior Mining Basics
2. Trading Mechanics and Market Structure
3. Brokerage, Market Access, and Fees
4. Capital Structure, Dilution, and Financings
5. Exchanges, Listings, and Tickers
6. Currency, FX, and Settlement
7. Corporate Actions, Share Counts, and Trading Halts
8. Risk and Due Diligence
9. Market Cycles, Timing, and Commodity Leverage
10. Technical Mining Concepts
11. Subscription, Access, and Communication
This page exists to reduce uncertainty for investors evaluating junior mining and Junior Mining Pro.
Junior mining operates under different constraints than large-cap equities. Liquidity, execution, and capital structure matter as much as the underlying asset. Most mistakes in this sector are mechanical, not analytical.
This is a living document. If a question comes up repeatedly, it will be added here.
How to Use This Guide
You do not need to understand every technical or geological detail to participate in junior mining.
You do need to understand:
How trades are executed
Where liquidity sits
How capital structures evolve over time
This guide focuses on those foundations.
1. Getting Started: Junior Mining Basics
What exactly are junior mining stocks?
Junior mining companies are small-cap exploration and development companies focused on discovering and advancing mineral deposits. Unlike major mining companies that operate multiple producing mines, juniors typically have market caps under $200 million and are focused on exploration, resource definition, or advancing projects toward production.
They are high-risk, high-reward investments that can deliver exceptional returns when discoveries are made or projects advance. Many juniors fail or underperform.
Why invest in junior mining stocks instead of major mining companies?
The math is simple. A junior with a $20 million market cap that makes a significant discovery can multiply 10x, 20x, or more. A $50 billion major miner is unlikely to deliver those kinds of returns.
Juniors offer asymmetric risk and reward. You risk 100 percent on the downside, but the upside can be 500 percent, 1,000 percent, or higher. That said, most juniors fail or underperform, which is why stock selection and timing matter enormously.
How much of my portfolio should I allocate to junior mining stocks?
Junior mining stocks are inherently speculative.
As a veteran investor with decades of experience and a vast information network, my personal allocation is much higher than what would be appropriate for most investors. For beginners, starting with an allocation of less than 10 percent of a total portfolio should be considered.
Within that allocation, diversify across multiple companies and commodities. Without experience or guidance, these stocks can crater before you have an opportunity to act. Only invest capital you can afford to lose completely.
What’s the difference between exploration companies and developers?
Exploration companies are drilling to find new deposits or expand known mineralization. They are the highest risk and highest reward. A discovery hole can move a stock 50 percent to 100 percent or more in a single day.
Developers have already defined a discovery and are working toward growing the resource, completing feasibility studies, permitting, and financing. They are lower risk than explorers but still face significant hurdles before production.
Each stage has a different risk profile and catalyst set.
2. Trading Mechanics and Market Structure
What is the bid-ask spread and why does it matter in junior mining stocks?
The bid is the highest price a buyer is willing to pay.
The ask is the lowest price a seller is willing to accept.
The difference between the two is the bid-ask spread.
In junior mining stocks, spreads are often wide due to low trading volume, limited market makers, and concentrated ownership.
Wide spreads are a real cost. You pay them when entering and exiting a position. In illiquid names, that cost can materially affect returns even if the stock price moves in your favor.
Quoted prices can be misleading. A stock showing a last trade at $0.50 may realistically be buyable only at a higher price and sellable only at a lower one.
Execution reality check:
If you are not aware of the spread before placing a trade, you are not aware of the true price you are paying.
Market orders vs limit orders
A market order executes immediately at the best available price.
A limit order executes only at a specified price or better.
In thinly traded junior stocks, market orders can fill far away from the last traded price, especially during volatile periods or low-liquidity sessions.
Limit orders define acceptable execution. They prevent unintended slippage and should be the default approach in this sector.
Execution reality check:
Market orders transfer price control to the market.
Limit orders retain it.
Why liquidity often matters more than valuation in junior miners
Liquidity determines whether capital can enter or exit a position without distorting price.
Junior miners frequently trade limited daily volume. Financing events increase supply. Promotional activity can create temporary demand spikes that fade quickly.
A stock can appear inexpensive on paper and still be difficult to own responsibly. Liquidity constraints often dominate theoretical valuation in practice.
3. Brokerage, Market Access, and Fees
How do I buy Canadian junior mining stocks if I live outside Canada?
Most junior mining companies trade on Canadian exchanges, primarily the TSX Venture Exchange (TSXV) and the Canadian Securities Exchange (CSE).
Many international retail brokers do not support these venues. If your broker does not provide direct access, you may not be able to trade the securities discussed here.
How do I buy Canadian-listed mining stocks as a U.S. investor?
U.S. investors have several options:
Trade the U.S. OTC ticker. Many Canadian juniors have OTC listings with tickers ending in “F.”
Open an account with a broker offering Canadian exchange access. Interactive Brokers, TD Ameritrade, Charles Schwab, and Fidelity all offer access, though fees and requirements vary.
Trade through international or Canadian brokers, which adds complexity with currency conversion and tax reporting.
Note: OTC spreads can be wider than on the Canadian exchange, and liquidity may be lower. For serious junior mining investors, direct access to Canadian exchanges is worth the effort.
How do European investors access Canadian mining stocks?
European investors typically use:
Interactive Brokers
Saxo Bank
Lynx Broker
Local brokers with international access
Availability, fees, and OTC access vary by country. Some European platforms do not support OTC tickers.
How do Australian and Asian investors buy Canadian junior mining stocks?
Australian investors can use:
Interactive Brokers Australia
CMC Markets
CommSec (limited access)
Asian investors should check:
Interactive Brokers (available in Singapore, Hong Kong, Japan, India)
Local international brokers with North American access
Some major banks offering international trading platforms
Currency conversion and time zone differences add complexity, but serious junior mining investors worldwide find ways to access Canadian markets directly.
Recommended broker for Canadian stocks
Interactive Brokers is commonly used by international investors trading Canadian junior mining stocks.
Key characteristics:
Access to TSXV and CSE listings
Low-cost foreign exchange conversion
Multi-currency accounts
Institutional-grade order routing
Broad international user base
It is not the only option. It is the most commonly used solution among international participants in this segment.
What are the typical commission fees?
Fees vary widely:
U.S. brokers with Canadian access: $0 to $6.95 per trade
OTC trades: often higher, $4.95 to $15 per trade
Canadian brokers: CAD $5 to $10 per trade
International brokers: EUR or AUD $10 to $20 or more per trade
With smaller position sizes common in junior mining, fees can eat into returns. Factor this into position sizing.
Before placing a trade in a junior mining stock
Confirm you are trading the primary Canadian listing
Check average daily volume
Use a limit order
Be aware of recent financings and outstanding warrants
Understand the currency you are trading in
These steps help reduce avoidable errors.
4. Capital Structure, Dilution, and Financings
What is dilution and why is it unavoidable in junior mining?
Most junior mining companies do not generate operating cash flow. Exploration, permitting, and development require external capital.
Equity financing increases the number of shares outstanding and dilutes existing ownership.
Dilution is structural, not exceptional. It is the mechanism through which progress is funded.
When vetting new opportunities for subscribers, dilution and share structure are taken very seriously. Where the stock is held, by whom, how tight the float is, and where liquidity pain points exist all matter. Free-trading options and warrants can temporarily limit upside.
The difference between good dilution and bad dilution
Good dilution funds asset advancement at reasonable terms.
Bad dilution funds overhead, delays, or repeated resets at progressively worse pricing.
The presence of dilution alone is not the issue. The use of proceeds and financing structure matter more than the headline share count increase.
What is a private placement and why does it matter to public shareholders?
A private placement is a financing offered to select investors.
Placements often include:
Units consisting of shares and warrants
Hold periods restricting resale
Pricing discounts to market
These structures affect supply dynamics and future selling pressure once restrictions expire.
What is a warrant and how does it affect the stock price?
A warrant gives the holder the right to purchase shares at a fixed price before expiration.
Large warrant overhangs can cap price advances. As the stock approaches the warrant strike price, selling pressure often increases due to anticipated exercises.
Stocks frequently consolidate near major warrant levels until that overhang clears.
What are flow-through shares and why do companies use them?
Flow-through shares are a uniquely Canadian financing mechanism that provides tax incentives for exploration spending.
Companies renounce exploration tax deductions to investors, who can then claim those deductions. This allows companies to raise money at a premium to market prices, often 20 to 30 percent higher.
The tradeoff is selling pressure when the hold period expires, typically four months after closing, as tax-motivated investors sell.
5. Exchanges, Listings, and Tickers
TSX vs TSXV vs CSE
The Toronto Stock Exchange (TSX) is Canada’s senior exchange with higher listing standards, revenue requirements, and governance expectations.
The TSX Venture Exchange (TSXV) is designed for junior companies with lower market caps and earlier-stage assets. Most exploration companies start here and graduate to the TSX if successful.
The Canadian Securities Exchange (CSE) is another junior exchange with more relaxed standards and lower listing costs.
Why does the same company trade under different tickers?
Most junior miners have a primary Canadian listing and secondary listings in the United States or Europe.
The primary listing typically carries the most liquidity. Secondary listings represent the same underlying shares but trade in different venues and currencies.
Temporary price differences can occur due to FX movements and liquidity variation.
What is the OTC market?
The OTC market is a U.S. trading venue for foreign or unlisted securities.
OTCQB securities meet basic reporting standards. OTC Pink securities often do not.
Liquidity on OTC venues is generally lower than on Canadian primary exchanges. Price discovery usually occurs on the home exchange.
If a Junior Mining Pro stock pick is listed in the U.S., the minimum standard is typically OTCQB to ensure accountability, transparency, and reporting requirements.
6. Currency, FX, and Settlement
What currency am I trading in?
Canadian junior miners trade in Canadian dollars on domestic exchanges.
If your base currency is different, foreign exchange conversion will occur. Currency movements affect returns independently of stock performance.
FX exposure is part of the investment, whether intended or not.
How long do trades take to settle?
Canadian equities typically settle on a T+2 basis, meaning two business days after the trade is placed.
Until settlement completes, proceeds may be unavailable for reuse. In illiquid markets, timing can matter during periods of volatility.
7. Corporate Actions, Share Counts, and Halts
Shares outstanding vs fully diluted shares
Shares outstanding reflect currently issued equity.
Fully diluted shares include:
Warrants
Stock options
Convertible securities
Fully diluted figures provide a more complete picture of potential ownership and future supply.
Why share counts change frequently in junior miners
Capital raises, option grants, warrant exercises, and compensation structures all affect share counts.
Frequent changes are structural to the sector and should be expected.
What is a trading halt?
A trading halt temporarily suspends trading, usually pending material news or regulatory review.
Halts are common in exploration due to drill results, financings, or corporate transactions.
During a halt, orders cannot be executed. Broker policies determine whether existing orders remain active or are cancelled.
8. Risk and Due Diligence
What is jurisdictional risk and why does it matter?
Jurisdictional risk refers to political, regulatory, and operational challenges of mining in different countries.
Key factors include:
Permitting timelines and certainty
Political stability
Rule of law
Infrastructure
Social license and community relations
Corruption levels
Top-tier jurisdictions include Canada, Australia, the United States, Chile, and Botswana.
Mid-tier jurisdictions include Mexico, Peru, Argentina, and parts of West Africa.
Higher-risk jurisdictions include the Democratic Republic of Congo, Venezuela, and parts of Central Asia.
A world-class deposit in a terrible jurisdiction may never get built. A decent deposit in Canada or Nevada can attract financing and major company interest.
How do I evaluate management teams?
Track record is everything.
Look for:
Previous discoveries or mine builds
Capital markets experience
Technical expertise
Insider ownership
Red flags include serial stock promoters, management teams that jump from failed company to failed company, excessive salaries relative to market cap, and constant dilutive financings.
What are the biggest risks in junior mining investments?
Key risks include:
Exploration failure
Dilution
Commodity price exposure
Liquidity risk
Permitting and environmental challenges
Technical risks such as metallurgy or water issues
Market sentiment shifts
Junior mining stocks are momentum-driven. Bear markets can be brutal.
How do I spot promotional pump-and-dump schemes?
Warning signs include:
Unsolicited promotional emails or social media campaigns
Companies spending more on marketing than exploration
Celebrity or influencer endorsements
Vague or hyperbolic press releases
Management with a history of failed promotions
Unusual trading volume spikes on no news
Message board hype without fundamentals
Legitimate discoveries do not require artificial promotion.
9. Market Cycles, Timing, and Commodity Leverage
When is the best time to invest in junior mining stocks?
Junior mining stocks are brutally cyclical.
The best times to buy are:
During bear markets, when sentiment is poor and quality companies trade near cash value
Before major catalysts such as drill programs, feasibility studies, or permitting decisions
Early in commodity bull markets
Avoid buying broadly during euphoric peaks when everything is expensive.
What’s the typical timeline for a discovery to become a mine?
From grassroots exploration to production:
Discovery to resource definition: 2 to 5 years
Preliminary Economic Assessment: 1 to 2 years
Prefeasibility and feasibility studies: 1 to 3 years
Permitting: 2 to 7 years, depending on jurisdiction
Financing and construction: 2 to 4 years
Total timelines of 10 to 20 years or more are common. Many discoveries never become mines. Major companies often acquire projects during permitting or early construction rather than waiting a decade.
How do commodity prices affect junior mining stocks?
Junior mining stocks are leveraged plays on commodity prices.
A 10 percent move in the underlying commodity can translate to 20 to 50 percent or more moves in junior stock prices.
During commodity bear markets, even quality juniors can decline 70 to 90 percent. During bull markets, they can rise 500 percent or more.
This leverage works both ways. Position sizing and risk management are critical.
10. Technical Mining Concepts
What makes a good mining jurisdiction?
Beyond political stability, consider:
Clear and predictable regulatory frameworks
Reasonable tax and royalty regimes
Strong geological prospectivity
Existing infrastructure such as roads and power
Supportive local communities
Efficient permitting processes
Protection of property rights
Canada, parts of the United States, and Australia rank highly. Australia is excellent but more expensive. Chile has a strong history despite recent political shifts.
How do I read and interpret drill results?
Key elements include:
Grade: concentration of metal
Width: interval length, including true width versus drilled width
Continuity: whether mineralization connects between holes
Location: depth, geometry, and proximity to infrastructure
Context matters. One gram per tonne gold over 100 meters can be excellent in a bulk-tonnage open-pit scenario but poor for underground mining. Ten grams per tonne over two meters can be outstanding in a high-grade vein system.
What’s the difference between indicated and inferred resources?
Under NI 43-101 or JORC standards:
Inferred resources have the lowest confidence
Indicated resources have higher confidence and more drilling
Measured resources have the highest confidence
Only measured and indicated resources can be used in economic studies. Inferred resources cannot be converted to reserves.
Reserves are a subset of measured and indicated resources that have been demonstrated to be economically viable through detailed engineering and economic analysis.
11. Subscription, Access, and Communication
What’s included in the Premium subscription?
Premium subscribers receive:
All deep-dive company analyses and investment theses
Regular portfolio updates and position sizing guidance
Access to the complete research archive
Market commentary and sector analysis
Real-time insights on market-moving news
Ability to comment and engage with the community
What’s the difference between Premium and Founding Member tiers?
Founding Members receive everything in Premium plus:
Private email access for capital allocation guidance
Early access to new research and ideas
Direct communication channel for time-sensitive questions
Priority access to special reports
Do you provide specific buy and sell recommendations?
Junior Mining Pro is not a licensed broker and does not provide personalized investment advice.
Analysis reflects personal research, experience, and in some cases personal positions. Investors must make their own decisions based on their risk tolerance and individual circumstances.
How often do you update coverage?
Portfolio positions are updated regularly. Updates are issued when material events occur, such as drill results, financings, or permitting developments.
The junior mining sector moves quickly. If something significant happens, subscribers hear about it.
Can I email you questions?
Premium subscribers can comment on posts and receive responses when time permits.
Founding Members have more direct access via email. Please allow one to three business days for a response.
Final Note
If a question is not answered here, comment on any post. If the same question comes up multiple times, it will be added to this FAQ.