Silver Wheaton is one of a few well-known silver plays. And I’m behind silver for a lot of reasons…

Over the last 200 years, the mean gold/silver ratio has been 31.32. Today it’s surged to 69.

A simple reversion to the mean makes a great play here. For those of you without finance books handy, it means that silver is more likely to move up to maintain the average ratio.

But that’s not all…

Silver – A Consumption Commodity

Silver isn’t just a store of value, it’s a consumption commodity.

Globally, 63% of demand for silver comes from industry or photography. Only 27% ends up in coins, medals or jewelry. Silver goes into everything from batteries to ball bearings, electronics to electroplating, and medical devices to mirrors.

Only 11% of gold demand comes from industrial uses, and the gap is widening.

Researchers find new uses for silver constantly. For example, UK researchers found that coating medical equipment in silver ions prevents infections. Coating lumber with a fine silver mist makes it resistant to mold and mildew.

As industrial consumption increases, less of each year’s production will be available for holding as a precious metal.

However, this does make silver dependent on a consumption economy… which we seem to be lacking at the moment. Silver won’t really move until we get a turnaround in the global economy. But that doesn’t mean that Silver Wheaton Corp will have to wait that long.

Source: Silver Wheaton Corp (NYSE: SLW): Stock of the Day

Silver Wheaton posted a 5% jump in third-quarter profit to $20.2 million, or $0.08 per share. Silver sales tallied 2.7 million ounces at cash costs of $3.93 per ounce, down from 3.1 million in the same period a year earlier. The company lowered its 2008 sales projections to 11.4 million ounces, from 13-15 million ounces previously envisioned. Silver Wheaton ended the day up C$0.13 at C$4.33.

Rockwell Diamonds got its wish with Pala Investments Holdings pulling its hostile takeover offer for the diamond miner. Rockwell ended the day down C$0.075 at C$0.13.

Shares of GobiMin got a pop after the company announced the sale of three nickel-copper projects in China to Xinjiang Xinxin Mining Industry for a cool $87.5 million. GobiMin ended the day up C$0.24 at C$0.68.

Shares of Hathor Exploration continued to bounce off its recent lows by adding C$0.44 to close at C$2.24. The junior is outlining the MidWest NorthEast uranium deposit in Saskatchewan.

Goldsource Mines added C$0.45 to close at C$2.14 on no new developments. The company is working the Border coal property in Saskatchewan. High River Gold Mines continued to fall into the abyss. The financially plagued miner ended the day down C$0.04 at C$0.07.

The first trading day of November brought no surprises with traders awaiting the outcome of the United States Presidential election before placing big bets. We will see what Tuesday trading has in store.

Source: Resource Stock Roundup Tuesday, November 4, 2008

For the tale of the tape, the TSX Exchange lost 0.58%, while the TSX Gold Index gave back 1.6% and the TSX Venture Exchange, Canada’s largest junior exploration bourse, fell 0.44% with the declining issuers swamping the advancers by a 562 to 466 margin on volume of nearly 218 million shares traded.

Silver Wheaton stepped up to the plate and has agreed to buy 50% of the life of mine silver at Aurcana’s 80% owned La Negra mine in Mexico. The price tag is an upfront cash payment of $25 million. Aurcana ended the day up C$0.06 at C$0.64.

It was a good session for shareholders of X-Terra Resources as the junior applied for shale licenses in Quebec. The junior received a letter from the Ministry of Natural Resources to confirm the application permits for over 120,000 hectares. X-Terra ended the day up C$0.73 at C$2.21.

Shares of Buchans River added C$0.04 to close at C$0.225 after the company announced a drill intercept of 6.64% zinc, 3.01% lead, 0.65% copper, 15.06 grams silver and 0.11 grams gold per tonne on the Lundberg zone in Newfoundland.

Radius Gold has inked a deal with Kappes, Cassiday & Associates to develop the high-grade Tambor gold deposit in Guatemala. The agreement envisions an initial 150 tonne per day operation from both underground and surface pits. Kappes can earn a 51% interest in the project by spending $6.5 million over four years or by putting the project into production. Radius ended the day up C$0.05 at C$0.32.

Newmont Mining put itself on the brink of bidding for Gabriel Resources after buying an additional 1.5% equity stake in the company on the open market. That gives Newmont 19.9%, just a tad less than the 20% threshold that would trigger a mandatory offer. Gabriel ended the day down C$0.04 at C$2.86.

Gold took one on the chin as it made a run at the $900 per ounce mark but failed to break through. We will see what Wednesday trading has in store.
Source: Resource Stock Roundup Wednesday, June 4, 2008