A Unique Way to Profit from Gold and Silver

While there are many ways to invest in gold, none that have entailed long positions have been very rewarding in recent market action. Over the last week of trading, the GLD, the exchange traded fund for gold, SPDR Gold Shares (GLD), is down. For 2013, it is off by more than 16%. For those looking to gain from the value of gold in its many different forms, sea wreck recovery companies such as JD Hutt (OTCBB: JABA) and Odyssey Marine Exploration (OMEX) offer a unique way to profit.

According to an article in Popular Mechanics magazine, there is over $60 billion in treasure from sea wrecks. Much of that is in gold and silver. There is little competition for it. JD Hutt and Odyssey Marine Exploration have tremendous advantages in the sector.
As reported last week in The Wall Street Journal, JD Hutt just acquired Sea Treasure Recovery Corp. The focus of its operations will be in coastal Florida waters. It was in the Florida Keys in 1985 that Mel Fisher made the legendary $450 million find of treasure in a Spanish galleon site. In the wreckage of the Nuestra Senora de Atocha was over 40 tons of gold and silver. Obviously the technology for locating and salvaging sea treasure has improved since then; as has the price of gold and silver.

Last month, Odyssey Marine Exploration recovered over 60 tons of silver off the coast of Ireland in a ship sunk by a U-boat in World War II. From the wreckage of the USS Gairsoppa, this find is valued at over $75 million, the biggest ever from a shipwreck. That haul is worth about one-third of the market capitalization of Odyssey Marine Exploration. The British Government gets 20%, and the shareholders of Odyssey profit from the sale of the other 80%.

Operations like those are why Odyssey Marine Exploration has a gross margin of 96% with a return-on-equity of 127.10%.
The future is bullish for Odyssey Marine Exploration and JD Hutt. Odyssey Marine Exploration is active in deep water ventures, which are more risky. Sea Treasure Recovery Corp. is operating in shallow waters. Both offer the potential for high profits, which has been recognized by the investment community.

Just last week, Lake Street Capital issued a positive report about Odyssey. The company has also been hiring, which is another bullish sign. The JD Hutt buy of Sea Treasure Recovery Corp. is certainly a positive sign for the potential of the industry. Also encouraging is that, on a quarterly basis, earnings-per-share are up more than 50% for Odyssey Marine Exploration. Now that it is part of a publicly traded corporation, Sea Treasury Recovery Corp. should be reporting similar results.

At present, the GLD has a short position of almost 30 million shares. Obviously, many investors are betting that the price of gold will continue to fall. Riches from the deep from the operations of Sea Treasure Recovery Corp. with JD Hutt and Odyssey Marine Exploration, however, could provide the positive returns that investors are looking for from precious metals in a unique manner.