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This column usually focuses on long-term asset-allocation themes for Self-Managed Superannuation Funds (SMSFs) and other long-term investors. But every now and then a few speculative ideas emerge as a tasty side dish to the main course of sensible portfolio investing.

Three themes have caught my eye in recent weeks: silver, gold producers, and emerging medical-stgice companies. Silver and African gold stocks have been smashed this year and small lifescience stocks are badly lagging the biotech boom in the United States.

A few caveats first. Investors in the balanced stage of retirement savings (within five years of retirement), moderate stage (about to retire) and conservative stage (in retirement) should never speculate. There’s enough risk in blue-chip shares without punting on micro-cap stocks.

Even portfolios in the high-growth stage of retirement saving (a significant number of years to retirement) or growth stage (5-10 years to retirement) should avoid speculative micro-cap stocks. I don’t buy the old line that “there’s nothing wrong with having 5 to 10 per cent of your portfolio in speculative stocks”.

The ideas above suit experienced traders who can profit from short-term rallies and are willing to take on higher risk. Their recent price gains could easily reverse if global equity markets have a correction or pullback later this year, as I expect. Disclaimers aside, the three ideas above have some merit.

Silver

I wrote in April for The Bull that: “The other precious metals – silver and platinum – have more short-term appeal (than gold). Silver is an interesting play on an eventual recovery in precious metals prices and stronger demand from the electronics industry, where it is used.”

The silver price slumped from US$32 an ounce in January to US$18.61 in July, and has since rebounded to US$22.83. Silver has been in a savage downtrend since peaking above US$45 an ounce in 2011. Weakness in precious metals and a slowing global economy weighed on the price.

Leading commodity exchange-traded product (ETP) provider ETF Securities had a record weekly inflow of US$145 million in August for its physical silver ETP. ETFS wrote: “Better-than-expected Chinese industrial production numbers … likely prompted investors to switch from gold to silver, as the latter tends to benefit in high-growth environments. Over 50 per cent of silver demand comes from the industrial sector versus 10 per cent for gold.”

In a separate report, “Silver – time to Shine?”, ETFS wrote: “For opportunistic investors, the 29 per cent decline in the silver price over the past 12 months represents a potentially attractive entry level. While silver is the worst-performing precious metal this year, a closer analysis reveals it may have corrected too far and it is poised for future growth.”

I prefer silver to gold because of its greater leverage to improving global economic growth and exposure to high-growth industries like electronics. Other indicators such as the gold/silver ratio hitting a three-year high this year, and technical analysis showing long-term support for silver around US$20, which it successfully tested, are positive.

Select African gold producers

African gold stocks, all the rage in 2010, have been a source of catastrophic wealth destruction in recent years. The falling gold price, heightened sovereign risk in Africa, and market concerns about funding risks have created a perfect storm for West African gold producers and explorers.

I’m especially wary of buying resource stocks, local or foreign-based, which need to raise significant equity capital to fund feasibility studies, build mines and get into production. This is no market for resource companies that have to issue heavily discounted stocks and dilute shareholdings.

As such, it’s important to stick to producers over explorers and those in more pro-mining countries. West African standout Perseus Mining crashed from a 52-week high of $3 to 50 cents in July, before rounding to 81 cents. Perseus spiked 12 per cent on Monday, but in response to an ASX price query, it said it was not aware of any new information.

Perseus has had some production glitches, and gold production for the half was slightly below the bottom end of market guidance at 105,000 ounces. It FY14 guidance is for 190-210,000 ounces. The market may have been too bearish towards Perseus and, for that matter, Resolute Mining, another higher-quality African-focused gold producer that has rallied in recent weeks.

Lifesciences

The US Nasdaq Biotechnology Index is up 45 per cent in the past 12 months, continuing a sharp rally since 2009. And 29 US biotech floats this year have delivered an average share-price gain of more than 40 per cent since listing.

Back home, the Life Sciences (ex-majors) Index is up just 7 per cent this year, the PwC July 2013 BioForum report shows, and there have been no local biotech floats. Biotech bulls believe the US boom will eventually boost sentiment towards smaller Australian peers.

They may be right, but small life-science stocks have had many false starts over the years. Still, I’ve noticed more brokers lately recommending emerging medical-stgice stocks such as GI Dynamics and Osprey Medical. Both companies have barely been on broker radars since they listed.

GI Dynamics, stgeloping a stgice that helps control glucose levels, thus treating obesity and type 2 diabetes, has rallied from 56 cents to 72 cents in recent weeks. The well-funded GI Dynamics has been among the higher-quality, most promising medical-stgice companies after raising $80 million through a 2011 Initial Public Offering at $1.10 a share.

Tony Featherstone is a former managing editor of BRW and Shares magazines. This column does not imply any stock recommendations or offer financial advice. Readers should do further research of their own or talk to their adviser before acting on themes in this article. All prices and analysis are at August 21, 2013.