RE: New here - any LTHs with some advice/knowledge19 Oct 2020 21:37
The reality is these companies always need money at this stage. It’s one of the reasons for listing so why are PI’s surprised when they do raise. I actually couldn’t care what the BoD says. You gotta try and work out cash and cash burn and even then how often do you see ‘the BoD has raised to accelerate our operations taking advantage of favourable market terms, bla bla..”
Just look at SGZ recently. I didn’t see that one coming but then they changed plan and brought the 2nd year schedule forward. I was ok as have a lower average there and that is the defence for newbies, that said I bought all I could on the drop to 115! Spread the risk and try to get in early so that when they do raise it’s near or preferably above your average sp.
In terms of spreading risk I am not a fan of South America or some parts of Africa. I don’t mind a little exposure there but prefer Australia if I can. I think we are on the cusp of a small cap mining boom, again!
Whilst a rising tide lifts all ships I’d still rather be in ‘safer’ geo’s and have added ECR, COBR, THR and CCZ to the pf recently. I think after the run at GGP, many, self included have done well and those stocks (and others) will be in demand.
Others held are GRL, SGZ, PUR, GGP and SHG. Tanzania and Ghana are exceptionally mining friendly and have good infrastructure, obviously so does Canada. One could argue that the riskiest place is Scotland! Brexit, Indy vote, covid to pay for and as a precedent the UKCS has seen more fiscal change than Ghana! Lol!
Spread your weighting across a few. I knocked up a little spreadsheet with small cap mining companies down the left and across the top I wrote, mcap, sp, geo, cash position, ops position, grades, BoD etc etc and scored each.
I then allocated as I could. I had to sell elsewhere to add ECR and THR today who were next on my list. Luckily I just got in here in time and am already £70 up!
Usual caveats.
Trek
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