Insiders in the natural resource business often talk about "shopping season" this time of year.
But they're not referring to Christmas presents.
As I've discussed before, this is the time of year when many natural resource investments can be had at bargain prices.
This is particularly true for the smaller firms that my premium natural resource newsletter, Scarcity & Real Wealth, was created to focus on -- the kind of companies that offer potential for double or even triple-digit gains through the discovery of major mineral or petroleum deposits.
With commodities prices falling, a large number of firms have seen their share prices decline. Sentiment has in fact turned down to such a degree that many of these firms are selling for cash flow multiples lower than we've seen in decades.
I've been purchasing a number of these companies for my portfolio over the past few months.
The thing is, today we're seeing even better prices on these already-cheap companies.
That's because many holders of these stocks are dumping them indiscriminately right now.
Many of the junior resource companies I tend to follow are listed in Canada -- the center of the universe when it comes to raising capital for small mining and oil and gas companies.
And Canadian investors have some unique tax incentives that come into play this time of year, affecting not only Canadian-listed companies but also firms that have cross-listings on U.S. exchanges.
But let me be clear: You don't have to live in Canada to take advantage of the bargains created by this phenomenon.
Here's how it works.
This time of year, Canadian investors sitting on stocks that have seen losses will often sell them for one reason alone -- to book the investment loss and claim it against their taxes. In many cases, the same sellers will buy the exact same stocks after the New Year. They simply need to crystallize their losses during the current tax year.
This means they can afford to sell at almost any cost. It's a phenomenon that leads to tremendous selling pressure -- temporarily driving stocks to unbelievably low levels without any regard for the business fundamentals or cash flows of these companies.
Buying this disconnect has been a money-making strategy among industry veterans for decades. I've watched insiders profit from it repeatedly.
Now I'd like to help you do the same.
Had you known about this anomaly just one year ago, you could have made a 29% gain between December and February.
And had you known about it two years ago, you could have made 33%... 46%... even 50% gains in a month.
In prior years, like 2008, you could have made a quick 92% or even 100%... all without trading options, short-selling, or doing anything but buying and selling regular stocks on American stock exchanges.
Thankfully, history tends to repeat itself. The ideal circumstances to profit from this anomaly appear to have lined up again, and it could start happening as soon as December 10.
When investors are facing double-digit losses at year-end, tax-loss selling usually sets in hard and fast. And this is creating great bargains for savvy buyers in the process.
Some of the biggest bargains for tax-loss season are in the mining sector this year.
Just look at the chart below -- it's an index comprised some of the biggest names in the precious metals and mining space. The index has fallen off a cliff in 2014 -- down nearly 16% this year.
Starting with my own portfolio in Scarcity & Real Wealth, I can see a few mining stocks that look like good tax-loss buys right now. But in addition to those, there are a number of other high-quality stocks showing typical tax-loss "dips" in their share price.
Out of fairness to my paid subscribers I cannot give away the names, but I will be sending out an update shortly to subscribers of Scarcity & Real Wealth outlining my tax-loss plays.
If you walk away with only one piece of information after reading today's issue of StreetAuthority Daily it is this -- right now the market is littered with opportunities in the resources space.
In fact, I've even put together a detailed report that explains more about this Canadian tax "quirk" and how it could lead to gains of 29% or more by February of next year -- but only if you take action by December 10. As I said above I'll be giving very specific details on which companies offer the best tax-loss buying opportunities in my next Scarcity & Real Wealth issue. To get my free report, and learn where to look for these opportunities, click here.
This article was originally published on StreetAuthority.com: The Urgent Insider Secret That Could Lead To Quick Gains In Commodities