Australian Shares Sparty's Blog
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Main Forum•BUY ASX: FML says Gold Fund
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Angelos Demaskos, manager of the Junior Gold Fund at Sector Investment Managers, says that he fully expects the price of gold to remain at least where it is and that this year the gap that has opened up between bullion and shares of gold companies will start to close. His picks in the fund are Focus Minerals (LON:FML) and Spanish Mountain Gold (TSX-V:SPA)
See video
See earlier FML posts -
My thought is that gold will appreciate in value every time the USA print money, the EU print money, Japan prints money.... and any other nation prints money.
Japan today decided to print 10 billion of their currency
Gold cannot be printed. It's scarcety and so numbers are defined. As fiat moneys are printed, they become devalued... and so gold must increase in value against fiat money.
The population of the world is increasing at a rapid rate. China and India are bringing many million into the middle class. All of these people want... it does not matter what... they just want.
My thought is that the Junior Gold Fund will out-perform. FML and SPA will be assessed.
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Hi Alite, I agree with you. FML has made an interesting announcement today with an extension from 1km to 4.1km of their Treasure Island trove.
I think that there is quite a distinction to be made between the explorers and the producers.
I have several of the later. -
In my opinion Red 5 (RED) is a better option. It is yet to be re-rated at $2.30 with a view to 4.50 and in 2 years $7.00.
I hold RED
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FML now on track to equal Alacer's gold output in 2013. Puts them as number 4-5 of our producers... a golden bargain.
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The graphs that you have presented does not show Troy Resources (TRY). Cash cost $400 − 550 after silver credits (bottom end on your graph) and 130K oz of gold to be produced / annum in 2012 (33K oz / 1/4 - maybe number 7 on your graph). They have a new high grade gold discovery and they always (11 years running) pay a dividend (at just 1.4% / share though better than most gold producers: NCM at 0.7%/share). Maybe better than Focus (FML)
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Hi Alite:
TROY:
• Group gold production of 32,774oz at a cash cost of US$407/oz net of silver credits.
• Casposo gold production of 20,479oz at a cash cost of US$330/oz net of silver credits.
• Andorinhas gold production of 12,295oz at a cash cost of US$535/oz.
• Net cash of A$15.1m after the payment of A$4.25m with the company’s 12th cash dividend over the last 12 years.
• On track to exceed the production guidance of 130,000 oz gold equivalent for FY2012.
Personally I am trying to stay away from high sovereign risk countries like Brazil and Argentina.
I updated the 2011 results on my Australian-gold.com/blog:
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Hi Sparty, Brazil and Argentina are now relatively medium risk.
There is no country where tax and political changes will not impact on the profitability of a company. The Australian Federal Government will be raiding the coal and iron ore producers soon with their MSPT. Who knows who they will go after next.
Brazil and Argentina were higher risk countries for mining but both have gone through political change and more importantly fiscal realisations: hard lessens learned after their defaults into the 2000s. It seems that they both encourage private enterprise and see the tax benefits of activity.
Recent reports ... (I wish I had your talent for posting graphs).... indicate that Brazil and Argentina are much less risky now with Brazil being less risky than the USA and Argentina being less risky than the Philippines, India, and China.
Australia tops the list for being the least risky with Canada No:2... though maybe not next year.
All said,... and as you stated above: Troy is near the lowest cost producer on the ASX and has a reasonable output with 32K oz per qtr on target.
As stated above TRY maybe better than Focus (FML).
——————— All this said goes out the window if the gold price jumps from US$1600/oz (due to QE3, Euro print or Japan print). Then the guy who produces the most will win the most (depending on hedging).
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Hi Alite, it is pretty easy to post a chart: the html is
I usually use width="550px" so for the image above the html looks like this:
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My source info on mining sovereign risk comes from: http://www.dolbear.com/Default.aspx?SiteSearchID=50&ID=/search-results
Tables not attainable.
Alite
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