Golden Prospect Precious... Share Discussion Threads

[bonnard] 01/2/2016 21:38

I like to have three reasons a share ought to increase in value and we have it here...
1. Large discount to NAV plus gearing by GPM.
2. Gold is increasing in value.
3. Many of the mines are in locations where the currency has fallen in value wrt the dollar which decreases their labour costs.

[brucie5] 01/2/2016 20:20

Yes. I think GPM will benefit from any shift towards PMs held in the large funds, not because they will invest in GPM (too small) but the shares they hold, which are on the less speculative end of the spectrum. To wit: RRS looking feisty, as well as FRES.

[bonnard] 01/2/2016 19:18

.....and the discount to NAV increases. £5 notes available for £4...
Eventually the share price for this IT has to rise if this continues.

[brucie5] 01/2/2016 18:53

NAV 22.74.

[brucie5] 30/1/2016 10:53

Here's another chart worth watching, Silver Wheaton. Apart from being a major holding for GPM, you can also see a double bottom in the chart from last year. That is, a bottom so long as it holds! It fell 50% in 2015, but does not yet share the counter-trend look of FRES, above. A break and hold of 18 might be a good sign.

[brucie5] 30/1/2016 10:42

FRES seems to be bottoming, make of it what you will. Give that the pos & pog have not yet shown reverse trends (back over the 200ma) I wonder if the clearly more viable miners are beginning to discount the recovery. GPM is not showing the kinds of accelerated take offs of some small mining plays, but it has been remarkably stable in the recent markets. Fres is surely a juggernaut of the silver miners.

[brucie5] 29/1/2016 22:15

Good stuff.

NAV 22.46.

[bonnard] 28/1/2016 23:28

These are from the 2014 Annual report. The 2015 report is not out yet.

[bonnard] 28/1/2016 23:26

Description Holding £ Net Assets
Equities
Australia
Ausgold 3,375,000 53,093 0.30%
Beadell Resources 7,665,000 904,347 5.16%
Gascoyne Resources 1,200,000 45,306 0.26%
Independence Group 430,000 994,368 5.68%
Lachlan Star 600,000 6,922 0.04%
Perseus Mining 581,451 79,273 0.45%
Phoenix Gold 3,076,924 153,278 0.88%
Regis Resources 500,000 506,020 2.89%
Resolute Mining 4,000,000 555,835 3.17%
3,298,442 18.83%
Canada
Asanko Gold 390,857 380,056 2.17%
Atico Mining 350,000 131,490 0.75%
Brazil Resources 500,000 157,457 0.90%
Castle Mountain Mining 2,511,000 443,929 2.53%
Endeavour Mining 1,675,000 388,670 2.22%
First Majestic Silver 395,000 1,272,279 7.26%
Fortuna Silver Mines 541,500 1,570,632 8.97%
Kennady Diamonds 102,631 256,858 1.47%
Klondex Mines 759,900 806,073 4.60%
Mandalay Resources 2,308,300 1,147,761 6.55%
Mountain Province 325,000 869,051 4.96%
New Gold Inc 182,000 499,740 2.85%
Perseus Mining 617,500 78,466 0.45%
Pilot Gold Inc 275,000 135,219 0.77%
Revelo Resources 610,350 28,663 0.16%
Santacruz Silver Mining 1,448,000 319,996 1.83%
Silver Wheaton 89,917 1,172,385 6.69%
Tahoe Resources 78,700 699,161 3.99%
Timmins Gold 900,000 556,900 3.18%
10,914,786 62.30%
United Kingdom
Aureus Mining 1,111,500 200,070 1.14%
Condor Gold 555,555 366,666 2.09%
DB Physical Rhodium 904 66,793 0.38%
ETFS Physical Palladium 24,750 1,227,531 7.01%
ETFS Physical Platinum 10,000 746,622 4.26%
Fresnillo 204,000 1,560,600 8.91%
Sovereign Bauxite of Guinea 100,000 – –
4,168,282 23.79%
Fair
Value % of Total
Description Holding £ Net Assets
United States
Continental Gold 600,000 609,938 3.48%
ETFS Palladium Trust 7,000 347,675 1.98%
957,613 5.46%
Total Equities 19,339,123 110.38%
Warrants
Ausgold A$0.05 15/05/2015 1,125,000 1,770 0.01%
Condor Resources 10/09/2018 277,777 – –
Gran Colombia Gold 30/10/2017 7,500 – –
Gran Colombia Gold Corp 30/10/2017 15,000 41 –
Total Warrants 1,811 0.01%
Bonds
Canada
Gran Colombia Gold Corp 10% 31 Oct 2017 750,000 199,782 1.14%
Maya Gold & Silver Conv Debt 8% 28/03/2017 500,000 220,992 1.26%
Total Bonds 420,774 2.40%
Total investments 19,761,708 112.79%
Other current assets less payables and accruals (40,534) (0.22%)
Bank overdraft (2,204,627) (12.57%)
Total Net Assets 17,516,547 10

[brucie5] 28/1/2016 19:58

No. The factsheet I hold is the same. Ring Craig up and ask him. He ran through a couple with me by way of illustrating, but would be good to have some on the bb.

[bonnard] 28/1/2016 19:52

Buy price is marked up though and has effectively risen accordingly.

Do you know where i can see the full portfolio form GPM. The data sheet only has the top 5 holings.

[brucie5] 28/1/2016 19:28

NAV 22.51.

[brucie5] 27/1/2016 16:37

Yes, well noticed: nav up by most of 1p since yesterday, which is c. 5%, without affecting the share price Will be interesting to see if this continues.

[bonnard] 27/1/2016 16:31

Brucie,

Excellent writup and thank you for that.

I think the price of shares in this investment trust is based upon the NAV albeit at a discount. There is very little buying and selling so little influence at present from investor demand. I see the NAV increased by about 1p from yesterday and is reported at 21.83 today, so that will put some upward pressure on the price.

Bonnard

[brucie5] 27/1/2016 15:34

Bonnard,
Just spoken to Craig Cleland, who's their named contact and seems to know quite a lot about the fund. Sounded very nice, and both thoughtful and well informed about GPM.

Concerning prices, the fund has been positioned to handle pog below $1k/oz, though at these prices capacity is continuing to be taken out through closures etc. This, he seemed to think, would be the main catalyst for movement in pog - though we also discussed the current low holding among pension funds of PGMs. I saw a figure recently, which was exceptionally low, and the point is worth making that a tiny increase in this would have a signal impact on gold buying. I think in current climate that's overlooked. The fact that gold did not react adversely to the recent rise in US interest rates might also signify that we have reached a bottom, incidentally. GPM hold overwhelmingly in Canada and Aus, though of course FRES is also a major holding. Interestingly (to me) they do not seem to hold any HOC, and nothing at all in SA.

Regarding iis, the holders seem to have remained happy to hold, though given the tiny size of the fund, this can't be anything but very small potatoes! Ruffer, apparently, is their largest (or among the largest) current holders.

It sounds like this is a pretty good medium punt on PGMs, especially if you want the relative safety of Canada and Aus. It has a discount of about 11% and also small amount of leverage (can't remember the figure - c. 15%?) which amounts to getting somewhat more bang for you buck, if pog/pos begins to motor north.

Incidentally, he says the team go to lots of conferences where peeps are talking up the prospects of gold and silver to stratospheric levels, but he doesn't see that happening in short order. He was very sober, yet positive, pretty much reflecting my view that we may be near an inflexion point, but not necessarily an explosion!

I continue to see triangulation on the chart, but have powder dry. Would prefer to average up than down, as one never can see the bottom of down, whereas up can go on very nicely for at least as long as it's gone down..

DYOR, risks certainly remain and none of this constitutes advice, etc.

B5

[stevieweebie2] 26/1/2016 16:48

Nice delayed buy as well.

[bonnard] 26/1/2016 12:10

I added today also. All these trades at 18.52 are buys.

[brucie5] 26/1/2016 10:34

I've started buying this morning at 18.50p. The share price seems absolutely comatose, which in current climate may have a lot to recommend it! Meanwhile a few junior miners are beginning to look frisky. I'm hoping that once the share price pops to 24p, the trend will be seen to have turned. But who knows.

[brucie5] 16/1/2016 13:27

I've been taking a look at their underlying shares. Silver Wheaton is 3rd largest, and an interesting business, which the MF explains here, and seemed to like in an article previous to this one:

hxxp://www.fool.com/investing/general/2016/01/14/how-much-dry-powder-does-silver-wheaton-have-for-2.aspx

[stevieweebie2] 14/1/2016 10:39

Brucie
I hold and have been buying on the way down at various points on that chart, I await with interest the real turn around, certainly looks as if a bottom is being formed.

[brucie5] 11/1/2016 09:43

I think we'll see the revival in pms from this chart. It could prove a useful indicator when the time comes. As everyone who's bought this on the way down will know - timing is (almost) everything.

[bonnard] 11/1/2016 08:16

It may be because they have been buying FRES more recently and it certainly is because the smaller miners have been marked down a lot more than gold. I would expect with their expertise that they would be holding viable companies that should bounce back. Also note that at the moment GPM is at a 15% discount to NAV.
Yes, 500% from here if there is a gold rally.

[brucie5] 11/1/2016 08:07

Bonnard, thanks so much - this is encouraging. Just wondering what the risks were beyond the commodities cycle itself. I see their largest holding is FRES, which has fallen to one third of peak value, while GPM has fallen to one sixth - presumably the effect of the smaller miners, which have been very badly hit. Your 500% would be a recovery to £1.20.

[bonnard] 10/1/2016 22:45

Malcolm Burne, is a former stockbroker and financial journalist with The Financial Times. He has controlled and managed fund
management, venture capital and investment banking companies in London, Australia, Hong Kong and North America. He has
been a director of more than 20 companies, many of which have been in the mineral resource and gold exploration fields. In
1997, he founded Golden Prospect plc and was executive chairman until 2007 when the company changed its name to Ambrian
Capital plc. In addition, he was executive chairman of the Australian Bullion Company (Pty) Limited, which at the time was
Australia’sleading gold dealer and member of the Sydney Futures Exchange. He is currently a director ofseveral other resources
companies in Australia and the UK.

[bonnard] 10/1/2016 22:35

Brucie, the director I had discussions with is Malcolm Burne who is now the Chairman of GPM. He is very approachable if you want to contact him. He left the FT to concentrate on setting up a company investing in gold mines, became a director of a few gold and silver mines, then took on this position with GPM and is ideal for his current role since he knows the business inside out.