Chapter 8. Mexican Gold
Investor: Andrew Swann
Date of Birth: April 26, 1954
Hometown: San Miguel de Allende, Mexico
Personal Web Site: None
Employment: Full-time investor
Passions/Pursuits: Fishing, tennis, and history
Investment Strategy: Junior gold stocks, oil, gas, hard assets
Brokerage Accounts: E*Trade
Key Metric: Cash flow
Best Pick: Desert Sun Mining, Up more than 1,000 percent
Worst Pick: Oilexco Inc., Down 92 percent
Performance Since September 2004: Cumulative return of 237 percent versus 11 percent for the S&P 500
Never underestimate the importance of good timing. Even the most accomplished investors will admit to this truism. The subject of this chapter, Andrew Swann, is an outstanding investor because his specialty has been gold and other commodity stocks like oil. In fact, gold and energy stocks have represented more than half of his investment portfolio for the last decade. During that time the price of one ounce of gold has soared from $300 to more than $1,100. Oil has also skyrocketed, rising from under $30 per barrel to a high of $147 in 2008.
Swann started investing in gold in 1996, but he became convinced that he should sell most of his other investments and become more fully invested in gold by January 2003. Since then he says his stock portfolio has risen nearly 600 percent in value. An investment in the SPDR S&P 500 ETF (NYSE: SPY) over the same period would have yielded a total return of 39 percent. I have ...