Golden Prospect Precious... Share Discussion Threads

[protean] 19/9/2011 22:13

"This divergence between the share prices of miners and the gold price has opened up what is rapidly becoming one of the hottest trades among hedge funds and other asset managers. Increasing numbers are betting that the underperformance of the gold mining sector is unsustainable, making equities ripe for a rapid rally."

"It's something that everybody is thinking about at the moment," Evy Hambro, manager of BlackRock's Gold & General fund, one of the largest gold funds, tells FT.com in a video interview. "A lot of our clients are switching out of the gold ETF [exchange traded fund] into gold equities and gold equity funds to take advantage of the opportunity."

[mozy123] 19/9/2011 16:32

Great break out on weak gold. The bonus options doing the trick for this to be valued more closly to NAV.

[jimbo55] 14/9/2011 17:01

Mozy,

For the Energy Fund, see:

In terms of the GPM placing of ordinary shares, this is currently a proposed placing and I suppose it will require shareholder approval. I don't know whether or not it will end up as an open offer. If it's principally an institutional placing, I suppose it won't; hence the free subscription shares as a sweetner to smaller PIs. You could always phone ncim to clarify. ;)

Regarding the immediate outlook for oil, I am with you in terms of it being short term bearish. However, at the end of the day, we are running out the stuff and it is becoming more and more expensive to extract. I don't see hydrogen powered vehicles on the road just yet, so I suppose we're going to continue requiring petrol and diesel for our cars. There is always going to be enough demand to offer support to the oil price if it falls dramatically. I guess I'm with Jim Rogers in terms of the longer term outlook.

In terms of what DaveBowler has just said, I hold a small amount of CYN and have participated in the associated CYN 3.5% CULS open offer.

Cheers.

Jimbo.

[davebowler] 14/9/2011 15:32

The new issue of CYN 3.5% CULS is a better deal in my view ( in the same fund manager's hands too ) However only 30% of its portfolio is in precious metals.

[mozy123] 14/9/2011 15:21

Jimbo,

Great post thankyou. I can definatly see the GPM trust being far north 150p by 2014. So its great news. They are only 20p+ away from the money.

Also, the placing of shares with new and existing investors... is that a rights issue? will i get the chance to buy the rights? Looks like they are just going to approach institions for the money in the placing.

Not sure about oil, can see much demand without qe3, the global economy is in ruins. However if we get QE3 i wil certainly look for this sub shares in that trust. Does it have a ticker?

[jimbo55] 14/9/2011 14:01

Mozy, these subscription shares are options, with a strike price of 150p.

Once listed, they will trade at a premium or hefty discount to the strike price depending on whether or not Mr Market perceives these options will expire "in the money".

As an example of fair value for these subscription shares, if the share price of GPM is 156p, a fair (at par) value for the new sub shares would be 6p. At 153p a fair value for the subs would be 3p. The sub shares can trade at a premium or discount to fair value.

Bear in mind that upon an "in the money" expiry, you would have to pay out 150p per subscription share you own to convert them into the oridinary. Failure to do this would mean your subshares would expire worthless. If the sub shares reach the expiry date and are NOT in the money, then they will be worthless.

I am quite familiar with subscription shares last year as I purchased £800 worth of GCLS subscription shares for GCL (Geiger Counter - another ncim trust) when it looked like there wasn't a hope in hell the sub shares would expire "in the money". I ended up making almost £10k out of this gamble. I therefore like the risk/reward opportunity offered by subscription shares for investment trusts, but these are not instruments on which you should even remotely consider betting the farm.

It may be of interest to you that ncim have an energy fund (invested predominantly in oil) that has performed woefully this year, and there are subscription shares for it currently tradeable in the market. From memory, the strike price for these sub shares is something like 76p, and the associated IT is somewhere around the 50p point at this point in time. Can't remember the precise time the sub shares expire, but could be worth a look if you like the risk/reward ratio (and acknowledge that buying the sub shares is a gamble).

[mozy123] 14/9/2011 12:54

AJ - I dont fully understand the announcment.

We are getting free sub shares. What value do they have? Are they bacically options to convert at 150p?

Plus the fund raising - i need to save money to apply for my extra shares!

[ajinvesting] 14/9/2011 12:48

I would say that the news is a big vote of confidence in the future of the fund, the future (much higher) $/£ price of gold and silver and the prospective value of gold miners on a 2-3 year view.

The free subscription shares might be a nice extra earner by 2013/14. It prompted me to buy some more shares this morning, which I was planning to do anyway.

[mozy123] 14/9/2011 12:26

Any comments on the news today?

[mozy123] 02/9/2011 16:40

Well done chris - this is so easy to make money from. Nav is 122.68p as of 31st august when the HUI index was 590. Its 620 today at the moment so this could easily be north if 125p Nav.

125-111 = 14p

= 12.6% discount.

chris - looks good for some upside on monday!

I will be adding some cash to my book on monday and see if i can pick up a few k under 112p a share.

[chrisis33] 02/9/2011 16:11

I've just added a few

[mozy123] 02/9/2011 15:43

Silver weaton is storming! Nav close to 125p now by my calculations.

[weyweyumfozo] 19/8/2011 15:36

This may be of interest to people here:

[chrisis33] 19/8/2011 15:24

Fres flying - one of GPMs largest holdings

[chrisis33] 03/8/2011 10:13

Silver wheaton had a better day yesterday too. Funny - trade just went through at £1.20?

[mozy123] 02/8/2011 13:11

127.38-113.25 = 14.13

14.13/127.38 = 11.09% discount

FRESNILLO on a huge day today. If silver wheaton can follow im buying more here.

[mozy123] 26/7/2011 13:23

130.75-114.5=16.25

16.25/130.75 = 12.4% discount still

[mozy123] 19/7/2011 16:35

Silver Wheaton is on one this afternoon!

[flips] 19/7/2011 11:24

The discount to NAV seems high when gold is performing so strongly; Nav 127p;
sp 114. discount 11% ish.

[fordtin] 19/7/2011 10:06

New fact sheet available;



Top 5 holdings as at 30th June 2011

Silver Wheaton . . . . . . . . 8.6% of gross assets
AusGold . . . . .. . . . . . . 7.0%
Extorre Gold . . . . . . . . 5.0%
Semafo . . . . . . . . . . .. 5.0%
Fresnillo . . . . . . . . . . 4.7%

top 5 holdings represent 30% of the total trust. The trust has a total of 37 holdings

[mozy123] 18/7/2011 23:29

yes probably, we are talking still a 12-15% discount, about the historic average i would expect, but soon we should be closing it to 7-5% when the demand for gold equities starts outpacing the rise in gold.

will be adding on weakness, it a great fund that has done 500% from the lows of 2008. not many funds have done that.

[chrisis33] 18/7/2011 22:57

Possibly around 130p now Mozy123? Silver Wheaton, Fres, and IamGold were all up 2-3%

[mozy123] 18/7/2011 20:50

127.34 - 111.5 = 15.84 or 12.4% discount.

Hui was up today, so Nav likely abit higher!