There were many ways to make money on Colorado stocks during the third quarter, but perhaps none was better than betting on precious metals.
The two top-performing companies in the state were gold and silver companies, each making gains of more than 50 percent. It’s no coincidence that the metals, silver in particular, have been on a steady climb since the beginning of the year because of continued economic uncertainty.
“We’ve been on a pretty good run,” said Jerry Danni, executive vice president of Golden Minerals Co.
The Golden-based company primarily explores and develops silver proj ects and was the state’s top-performing stock during the quarter. Part of the stock’s 90.6 percent gain was related to positive drilling results the company reported on its projects in Argentina and Mexico, Danni said.
The Bloomberg Colorado Index of stocks rose 11.8 percent during the third quarter. More than two-thirds of the roughly 110 stocks in the index ended with gains. The index rose less than 1 percent in the second quarter amid dour economic news.
The Standard & Poor’s 500 and Dow Jones industrial average each rose about 11 percent in the third quarter. Dow Jones Newswires reported that stocks posted their strongest September in 71 years as fears of a double-dip recession eased.
“Big-picture-wise, we’re in a recovery. Corporations are moving to gradually re-enter their production cycle; they’re ramping up,” said Al Woodward of Woodward Wealth Management Group in Greenwood Village. “When that happens, the stock market goes up. . . . I expect that to continue.”
John Claxton of RBC Wealth Management in Denver said the economy moved during the quarter from support by government stimulus toward sustainable growth, though tepid consumer spending and slow job growth continue to weigh on the markets.
“We’re working through a period of psychological transition from an investment point of view. Investors are turning back to traditional long-term investments from those short-term havens,” he said.
The state’s best performers for the year so far are shoemaker Crocs, Ramtron, media giant Liberty Media and restaurant chain Chipotle Mexican Grill.
But Denver’s roster of small gold and silver companies ruled the third quarter. Vista Gold Corp. of Littleton finished second with a 50.7 percent return, and Denver-based Gold Resource Corp. was fifth with a 45.2 percent gain.
Larger producers such as Newmont Mining Corp., Royal Gold Inc. and Golden Star Resources also posted gains, but not as large.
Vista Gold chief executive Michael Richings said investors may have taken longer to recognize the value of the smaller gold companies.
“Fairly high gold prices are already priced into the large companies,” he said. “I’m not sure the market had done that with the smaller companies.”
Greg Griffin: 303-954-1241 or ggriffin@denverpost.com
