If investing in senior and junior silver miners, you should know what these types of miners have to offer in terms of value and risk. Those who plan to invest in senior minors can look at companies’ balance sheets and income statements to find out what these companies are worth. The situation is different with junior miners where buying silver stock requires looking at charts, the company’s properties, getting to know the management body, and so on. There is no way to predict whether a junior mining company will make a discovery in many cases. Some investors just rely on their intuition, but experts recommend gathering as much information as possible. 
For example, it is good to know that the management body has performed well in exploration or the small mining field. Another indicator of a sound company is if its management had run or discovered a profitable mining site in the past. With junior miners, investors also look at their cash flow and cash balance. While some of them may have good projects, if their burn rate is three hundred thousand per month, with just under a million in the bank, they will go broke in a couple of months. This is a likely outcome if the management does not have access to additional financing. One question to ask a junior miner is how long they will be able to stay in business if things do not pick up as expected. Another important issue is whether the property or project they develop has any potential. Of course, you are likely to get estimates and there is no guarantee that the actual quantities of silver will match these. It is possible that the management, financial controllers, and geologists promise more as to attract investors.
While potential is one thing, especially on paper, exploration is not always feasible. For example, the infrastructure costs may be too high or the region may be hard to access, even though the drill results are decent. Senior mining companies are different in that. Senior miners are more experienced, larger mining companies that own and run existing mines. With mining sites already generating profits, investors find it easier to evaluate the company’s profitability. This comes with fewer surprises and a degree of consistency when it comes to stock prices. Junior mining companies, on the other hand, have to identify different mining sites and explore their potential. There is always a risk that exploration will not result in actual discovery. This can turn quite costly not only for the junior miner but for its investors as well. Many junior miners sell their sites to established mining companies to ensure better returns after they begin exploitation. If the company does not have money to open the mine, however, this is a sure sign of financial losses.
