How to Trade - The Most Traded Mining Stocks

Gold, silver, iron, copper, coal, for that matter any precious or industrial metal, or any other mineral – are all put to use only after they have been extracted, processed and manufactured into something useful. Though over the years, several processes have been developed for reuse and recycle of materials, however mining still remains a significant requirement in today’s world. The sector is concerned with an all-important activity of obtaining and processing of materials such as coal, metal ores or other minerals. Certainly, the sector has fared poorly over the last year or so, shedding an average 30% in stock value. But the fact only sparks high hopes of a recovery rally and hopefully in near future. If that still is not attractive from an investor’s point of view then being amply liquid stocks should make them appealing instrument from a trader’s point of view.This article highlights some of the most traded mining stocks on the US stock exchanges.

Vale S.A. (VALE)

With over 18.6 million shares traded daily (average daily volume) and over US$95 billion in market value, Vale S.A. has to be one of the most day trade reports stocks traded on the US stock markets. The company engages in the exploration, production, and sale of basic metals in Brazil and internationally. Further, it is also involved in fertilizers, logistics, and steel businesses. Its Bulk Material segment and Base Metal segment engages in several processes, for instance extraction of iron ore, pellet production, manganese mining, ferroalloys activities, production of non-ferrous minerals including nickel, copper, phosphates and nitrogen. The company was founded in 1942 and is based in Rio de Janeiro, Brazil. At the time of writing this article, this dividend-paying stock trades around US$18.50 per share, which is the lowest it has traded over 52-wk period. The highest being US$33.74 over the same period.

Freeport-McMoRan Copper & Gold Inc. (FXC)

Another mining heavyweight that on average trades 18.1 million shares daily and has a market capitalization of approximately US$31.1 billion. Founded in 1987, Freeport-McMoRan Copper & Gold Inc is headquartered in Phoenix, Arizona. The company engages in the exploration, mining, and production of mineral resources. Its core exploration revolves around copper, gold, molybdenum, cobalt hydroxide, silver, and other metals, such as rhenium and magnetite. As of December 31, 2011, the company’s consolidated recoverable proven and probable reserves included 119.7 billion pounds of copper, 33.9 million ounces of gold, 3.42 billion pounds of molybdenum, 330.3 million ounces of silver, and 0.86 billion pounds of cobalt. Currently, this dividend-paying stock trades at around US$32.75 per share with a 52-week range of US$28.65 – US$56.78

BHP Billiton Ltd. (BHP)

With a mammoth market value of approximately US$172 billion and an average daily volume of over 3-million, the world's largest mining company, BHP Billiton sets the standard by which other mining companies are evaluated across the globe. Founded in 1885, the company is headquartered in Melbourne, Australia. The company along with its subsidiaries, operates as a diversified natural resource company worldwide. It extensively engages in the exploration, development, and production of oil and gas; mining and refining of bauxite into alumina, and smelting of alumina into aluminum metal; and mining of copper, silver, lead, zinc, molybdenum, uranium, gold, diamonds, and titanium minerals, as well as development of potash deposits. Further, it also mines and produces nickel products, manganese ore, manganese metal and alloys, iron ore, metallurgical coal, and thermal coal. At present, this dividend-paying stock is considered to be highly oversold trading at a per share value of US$64.70 (approx) with US$62.54-US$97.27 as its 52-week range.

Rio Tinto plc (RIO)

Another important and fairly liquid stock in the mining sector is Rio Tinto plc. It has a market value of roughly US$86.7 billion with an average of over 3.3 million shares traded per day. The company was founded in 1873 and is headquartered in London, the United Kingdom. Rio Tinto plc is a subsidiary of Rio Tinto Group that engages in finding, mining, and processing mineral resources. The company produces aluminum products, including bauxite, alumina, and aluminum; copper, gold, molybdenum, silver, and nickel; diamonds; minerals, such as borates, titanium dioxide, iron, metal powders, zircon, and rutile; thermal and coking coal, and uranium; and iron ore and salt. Its operations are mainly carried out in Australia, North America, South America, Asia, Europe, and southern Africa. It has 63746 fulltime employees. Its dividend-paying stock is currently trading at a per share value of US$46.25 (approx) with US$40.50-US$70.00 as its 52-week range.

Though there are numerous other companies in this sector but keeping tabs on these four could greatly assist you to understand the overall market bias towards that mining sector. These stocks are not only good investments for long-term perspective but their high liquidity also make them attractive trading purposes. A hallmark of a successful trader is to adapt effortlessly to varying market conditions and be familiar with several investment tool, asset classification, sectors, etc to net profits consistently. In his endeavor, essential knowledge about mining sector and its characteristics can play a pivotal role.