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O&W, The discount has been pretty close to zero on a couple of occasions; notably August 2020 & again last May. If you go to the Hargreaves Lansdown website & bring up GPM, they have some nice graphs showing SP v NAV over time.
...to NAV, of course.
Anyone know if the sp of GPM went to a nil discount, or even a premium, when it was at 70p at the last high in July 2020?
I look at it from a macro perspective. Bond vigilantes have already done the tightening for the Fed, the equivalent of over one rate hike has already occured. Bond investors fleeing to precious metals as 10 year yields rise to 2.1% by next week then over next months near 2.5%. However, Fed will end up not hiking rates but rather will be forced by pervasive economic weakness to ease policy and ultimately be forced to restart QE later this year. Many sequential steps that will together push precious metals much higher as the year progresses. Should be a fun H1 2022 for precious metal stocks and funds.
Don't disagree...
Gold trying to plough through $1840 having been blatantly held around $1837 for at least 45 minutes...
Then a concerted bear attack from $1840 to $1836 failed and now we're above $1841...
Silver has similarly been banging on the door at $24, having come up from $22.783 to $24.121 in just over a day...
Bought another 50,000 at 42.4 today...
Lets see what tomorrow holds...
Next leg up for precious metals has started. My targets DXY to fall >10%; gold above $2400 and silver piercing $50 by mid-year. GPM should receive lots of attention given its large discount and focus on junior miners.
Just bought 120k under 40p...unreal...20% discount to NAV...
And there are two biggies after hours...
Think the issue here is that SCAP have had a seller of size since the run up in gold price last week. Currently trading at a -20% discount to NAV when normally this year has been more like -10%. Once he finishes should be a move back. Compare GDX index which GPM usually follows quite closely.
The biggest position in the GPM portfolio is West African Resources. This is a Burkina Faso gold mine, estimated to produce an average of 216,000 ounces of Gold per annum until 2030. The gold exposure is unhedged. The AISC is about $800 an ounce. The shares price was up 4.64% overnight in Australia, where the company is listed. If Gold breaks higher, this baby should rip. Just saying. Plenty of beta to the Gold price.
Just now, there are a few local difficulties in Burkina Faso, but they should be easily resolved.
All the Aussie listed Gold stocks seemed to perform last night in Oz.
As an aside, the Yellow Brick Road was written both as a children’s book, and an argument for sound money, and Gold. Follow the Yellow Brick Road!
OK, a few home truths….Gold and Silver are bubbling nicely, but GPM, and all the other PM investments (SILJ, FRES, POLY, CEY, HOC etc…) keeps disappointing. They never quite go up enough to justify the move in spot Gold and Silver.
Why?
Because there are so many stranded longs. Bag holders who are sellers on any spike.
What we need is a change of mind set where new buyers come in and just blindly buy. These miners should have a beta of 2 or 3 to spot precious metals prices. Currently we are stuck with less than 1. Miserable.
What will cause this mind set change? I am not sure. Maybe Brainard as Fed Governor. Maybe a 7 per cent print for US inflation. But the Tsunami has not burst yet in popular culture. But we need an acceleration, and so far it is not there. Not there at all. As P* accelerates (the velocity of money for those who are not economists) we need the PM space to accelerate too. Where are you, beta?
There has been a heavy seller for the last week, that's why the nav is low. Check the bunches of big trades every day
This stinks...
I believe the SP was artificially low yesterday given that the NAV was published at almost 60p on a day when Gold did quite well.
Was the SP being held back so that the Director could make his purchase at an advantageous rate?
The RNS states 50,000 at 46.25. That is BELOW the lowest priced bargain today which was a SALE at 46.40p
There is at the moment no bargain quoted at 46.25p today, but there is a 50,000 Buy at 8.03 at 46.75.
Is this an errror...?
Director loading up with 50,000 shares here:
https://investegate.co.uk/golden-prospect-prec--gpm-/rns/director-pdmr-shareholding/202111171038276841S/
I have nothing against crypto, but the whole Gold/Crypto debate is silly. They are different animals, with different risk profiles and different cultures.
Anything that can fall 10 per cent in a day on nothing is not a store of value.
There has been a heavy seller here since the jump in gold last week. Compare with GDX it's quite a drop, should be 50/51p still.
Can someone please explain what is going on here.. I'm dumbfounded? Is it just all money piling into crypto
Yes, a 20 per cent discount is absurd, especially with rising gold and silver prices, however, there have been a couple of issues in the portfolio recently: West African Resources mines in Burkina Faso, where there has been some local violence around gold mines. Fortuna Silver Mines has had problems in Mexico with its licenses. Shares in FSM are down about 20%. These two stocks are about 20% of the GPM portfolio.
Medium term, these issues should not matter. But in the short term, they provide good cause for investors to pause.
Once we close above 0.5, GPM should surge over 0.6 quickly. I remain long a lot, and expect the GPM share price to go well 1. So this baby should easily double.
The next step will be anew Fed chairman (Brainnard?) and the imposition of MMT as Fed policy. This should push $100 higher to 1975.
Happy Hunting x
Makes no sense at all that this would be down today when NAV has increased, the gap to NAV is getting wider and all of the top holdings are up on average 4%.
surely this size of discount to NAV cannot hold?
For those of you with a technical bent, a close above .487/.49 would trigger an inverse head and shoulders with a target at .59 or thereabouts. The break is likely with a move through 1825/35 in Gold. And it is Fed time. Lets see what happens. But the potential is there.
Up again yesterday to more than 48p per share - 20% discount to NAV in a rising market is very nice! Likely up to 50p today with all the major PGMs rising.
Me too...40,911 at 38.40...who'd have thought it?
NAV 46.86...unbelievable...
@38.4p.
:(