The first thing that comes to my mind when I think about investing in precious metals is the swift and severe price swings of silver and gold. That's volatility that gets my heart pumping in a not so good way and keeps me up at night. But Royal Gold, Inc.'s (NASDAQ: RGLD) incredible 16 years of consecutive dividend increases soothes my nerves. And that's just one of the reasons to love the company.
The first thing to understand is that Royal Gold isn't a miner -- it's a streaming company. It makes money by giving cash up front to miners for the right to buy gold and silver at reduced rates in the future. Miners use the cash to shore up balance sheets and fund mine development and expansion projects. Working with a streaming company like Royal Gold is particularly beneficial when banks and capital markets aren't offering up desirable terms, like during commodity downturns.
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Source: Fool.com