6 The IKN Weekly issue 630 — Jun 21, 2021
The IKN Weekly
Week 630, June 20th 2021
Contents
This Week: Trade heads-up, In today’s edition, About “ESG” and Eric Sprott, The GLD tracking
charts are bullish, A week of lower metals prices.
Fundamental Analysis: Re-buying Copper Mountain (CMMC.to).
Stocks to Follow: Orezone (ORE.v), Amarillo Gold (AGC.v),
Copper Basket: Overview, Chakana Copper (PERU.v).
Producer Basket: Overview, Kinross (KGC), StreamerWatch.
Tiny Dogs: Overview, Red Pine (RPX.v).
Regional Politics: Argentina: Chubut’s Zonification” law project now dead in 2021, Argentina’s
plan to “nationalize lithium”, Ecuador: A law project to ban mining in the whole of the country,
The Mexico regional elections and mining, Chile: The royalty law project is in committee, This
week in Peru, Peru: Julio Velarde is out at the BCRP.
Market Watching: Deferred.
I remind subscribers that no part of this newsletter can be copied, reproduced or
given to any third party without the express permission of the author.
This Week
“
Trade heads-up
I am a buyer of Copper Mountain (CMMC.to), please see today’s main Fundamentals section for
the details. I also plan to add to mu position in Amarillo Gold (AGC.v) and average down at the
current 30c share price.
In Today’s Edition
The market turned against commodities, metals and mining stocks last week, but we
don’t expect the bad times to continue and the result is an excellent buying
opportunity.
Many mining companies now look cheap this weekend, but Copper Mountain (CMMC.to)
looked cheap on forward earnings even before the selling began. This weekend’s
deeply discounted C$3.43 is impossible to ignore and a compelling re-entry point
Regional politics gets back to the job of covering the region, not just the infernal
Peruvian Presidential. However, it’s still the most important geopolitical influence on
mining in the region today, so close coverage continues.
About “ESG” and Eric Sprott
Last week’s note on the decision to sell Orezone and the resulting reflection on “Eric Sprott
Governance” (ESG) got plenty of mailbag and set off exchanges with several subscribers. A few
extra words are clearly required to state my position, so here goes:
This is about mining stocks and not life choices and I agree that while Eric Sprott may be a
good husband and loyal friend, he’s no saint. He is not my guru or lifestyle leader. When the
1
wrapping is removed he's a Canadian trader who made billions in the gold and mining market,
nobody can expect a moral paragon to emerge from that backdrop. The fact he shoots his
mouth off and likes pontificating about a dozen subjects is not the issue here, either: He is also
a salesman who knows his audience and is not about to bite the hands that feed him, so for
just one example his constant stupidities on Covid-19 are lapped up by his audience. On many
subjects he is plain wrong, but that's not why we are here and not why we pay attention to Eric
Sprott when he opens his mouth. We are here to buy low and sell high, period.
To repeat a part of last week's message, as Canadian regulators are toothless the only way
forward is self-regulation (or nothing) and rather than choose nothing, the Eric Sprott version of
morality in mining, the "ESG" outlined last week, is a better alternative available. As the Michael
Collins episode shows, under an activist Sprott scammy CEOs will now think twice before
crossing a line and I will take that, it's better than nothing. Also “better than nothing” is Bill
Sheriff and on this, several of you simply got the wrong end of the stick. I am not here
defending him (or any other CEO for that matter), but I am saying that his CV is acceptable to
our glorious leader ES. We are not in a perfect situation and “ESG” is always going to cater to
Eric Sprott’s own particular market bugbears. Bill Sheriff is surely one of “the usual suspects” in
Canadian mining, but if Eric “ESG” Sprott thinks his usual crew of semi-shady mining associates
is a better bet than a fully shady group, again, I'll take it.
All we require from a market is a reasonable amount of regulation, so that all participants are
playing by the same rules. We then have a better chance to do the only thing I personally want
to do in this 2021 market: Buy low and sell high. It would be far better that the law of the land
step up and controlled its capital markets, but as that isn’t going to happen soon we need to
look elsewhere for a moral compass in the sector. Eric Sprott might not be the perfect example
of a leader and an accurate guide to True North, but at this point he’s all we’ve got and as
such, I will support and follow his moral lead.
The GLD tracking charts are bullish
We feature our GLD charts prominently today, via two sets of timescales and their own
dedicated opening segment, instead of being tacked onto something else. Here’s the longer
view for today, that goes back to 2018 and we see that on the occasions our Inventory/Price
ratio spikes in the way it did last week, the future is rosy for gold bullion prices. Feel free to
check back further in time, that statement holds true through to 2012
7.60 GLD: Inventory/Price Ratio, 2018 to date
7.40
7.20
7.00
6.80
6.60
6.40
6.20
6.00
5.80
5.60
5.40
Our second pairing of the same datasets take in the last three months alone:
2
2/1/8102 2/3/8102 2/5/8102 2/7/8102 2/9/8102 2/11/8102 2/1/9102 2/3/9102 2/5/9102 2/7/9102 2/9/9102 2/11/9102 2/1/0202 2/3/0202 2/5/0202 2/7/0202 2/9/0202 2/11/0202 2/1/1202 2/3/1202 2/5/1202
GLD gold holdings, 2018 to date (metric tonnes)
1400
1300
1200
1100
1000
900
800
Source: SPDR data, IKN calcs
700
600
71/21/92 81/2/82 81/4/92 81/6/92 81/8/92 81/01/92 81/21/92 91/2/82 91/4/92 91/6/92 91/8/92 91/01/92 91/21/92 02/2/92 02/4/92 02/6/92 02/8/92 02/01/92 02/21/92 12/2/82 12/4/92
mt
source: SPDR GLD data
GLD gold holdings, March 2021 to date (metric tonnes)
1100
1090
1080
1070
1060
1050
1040
1030
1020
1010
1000
990
12/3/1 12/3/5 12/3/9 12/3/31 12/3/71 12/3/12 12/3/52 12/3/92 12/4/2 12/4/6 12/4/01 12/4/41 12/4/81 12/4/22 12/4/62 12/4/03 12/5/4 12/5/8 12/5/21 12/5/61 12/5/02 12/5/42 12/5/82 12/6/1 12/6/5 12/6/9 12/6/31 12/6/71
7.00 GLD: Inventory/Price Ratio, March 2021 to date mt
6.80
6.60
6.40
6.20
6.00
5.80
5.60 source: SPDR GLD data
1/3/1202 5/3/1202 9/3/1202 31/3/1202 71/3/1202 12/3/1202 52/3/1202 92/3/1202 2/4/1202 6/4/1202 01/4/1202 41/4/1202 81/4/1202 22/4/1202 62/4/1202 03/4/1202 4/5/1202 8/5/1202 21/5/1202 61/5/1202 02/5/1202 42/5/1202 82/5/1202 1/6/1202 5/6/1202 9/6/1202 31/6/1202 71/6/1202
Source: SPDR data, IKN calcs
The ratio spiked last week on a double whammy: We know gold prices dumped, fewer people
noticed that while the world was selling Wall Street was buying and on Friday GLD added over
eleven metric tonnes. Up on the week by over nine, GLD inventories stand this weekend at
1,053.06mt and a long way from the recent low of 1,017.04 metric tonnes, registered on April
30th. This is exactly the sort of action we’d want to see at a turn point for gold and it’s why this
indicator gets the space it does on these pages. Gold may have given us all a stomach-churning
week, but it’s also flashing a clear buy signal for the future.
A week of lower metals prices
Tuesday was the day China ramped up its moves against copper prices and it wasn't as if we
hadn't been warned either, these pages reporting on the negative vibes picked up in Chile on
several occasions in the past few weeks. However, doing it publicly instead of by stealth sends
an altogether stronger message and China's formal announcement that it was opening the
sluices on its strategic inventory stockpile of copper (and other metals, e.g. Al and Zn) was
done publicly and the strong message sent prices into a tailspin.
Then the Fed did its thing Thursday and the results can been seen here, this chart featuring
proxies for gold, silver, copper and their mining companies:
The Fed is in control, the policy moves a deliberate signal and the effects immediate: Jay Powell
is in the comfortable position of being able to control the direction of the US Dollar by talking
up rate changes in 2023. Control is his, he gets to strengthen the US Dollar when inflation is
their prime concern, drop it when they want to promote growth, our scenario of a rang-bound
US Dollar controlled by Jay Powell jawbone and MMT is set fair.
Our intro section normally tries to capture interesting events in the macro, but isn’t much use
for picking winning trades. To do that, we need to get practical with events and as last week
affected copper more than any other metal, it is to there we look. We expect this dip in copper
prices to be temporary. Expect China to continue interventions in the future, they didn't use
their one and only shot last week by any stretch of the imagination so expect multiple inventory
dumps. They can shout all they want, but nothing will cover the yawning supply gap in the
copper market from now to 2025. That fundamental fact means any market-based attack on
prices will be limited in depth and scope, but even if copper doesn't re-take U$4.50/lb
immediately (or on a schedule to our convenience), we shouldn’t worry. All we need are today’s
prices to make a low risk, high reward trade on copper and for that, we hand over to today's
main Fundamentals section.
3
Fundamental Analysis of Mining Stocks
Re-buying Copper Mountain (CMMC.to)
"I like to go for cinches. I like
to shoot fish in a barrel. But I like
to do it after the water has run out."
Warren Buffett
A standard justification used by anal ysts or market commentators when they decide to get
cute, tempt fate and buy back into a recent winner that has since dropped is to point to
changed circumstances. That’s what we do today a IKN re-opens coverage and I buy back
Copper Mountain (CMMC.to), but a phrase as clichéd as “In light of changed market
circumstances” does the opportunity in CMMC this weekend no favours, this one is a Warren
Buffett fish-in-a-dry-barrel.
With the sudden and almost certainly
temporary reversal in the price of copper,
CMMC got hit to the tune of 18% in a waterfall
selling pattern on first China, then the US Fed.
We understand that copper has been pushed
down by Chinese strategic dumping, we also
know that its effects, though sporadic, are
limited in scale and scope. However, copper
producers are making excellent coin at any
price above U$4.00/lb and CMMC is no
exception. These producers will rebound first
and fastest even if copper doesn’t- Therefore,
as well as being able to steer clear of the
vagaries of the exploreco and its progress (the next drill assay?) or small developer (on
time/budget?), the type of company that keeps bad news away from the market until it's too
late, we can back an open and transparent operator making predictable level of real cash profit
and, as a result, trading obviously discount levels. Already deeply discounted at C$3.70 on
Wednesday, when trading Thursday and Friday dragged the stock deeply oversold, the current
and compelling window of opportunity opened. The buy case for CMMC is as strong as it was
when we moved into the stock in November and December of last year, back then the profit
came quickly and there’s every reason to expect the same again With the impressive level of
overselling in both this name and the wider copper market last week, it would be a dereliction
of duty as a writer on mining stocks not to bang the table about CMMC, and bang it hard, so
that this audience understands the outstanding investment opportunity available to it tomorrow
morning.
We use straightforward ingredients in our analysis today, we are about expected financials in
2021 and beyond. We begin with a review of the production quarter reported by the company
in 1q21, to which we add our conservative expectations for the quarters to come (and they
really err to the side of caution this time, as you will see). Here’s the main event, copper
production:
CMMC: Copper production and sales, per qtr
4
016.81 843.91 054.81 139.71 203.61 120.71 885.81 895.71 274.71 268.71 290.81 978.81 439.81 428.71 350.32 217.81
625.52
105.72
0.32 0.32 0.32 0.42 0.42 0.52
30
25
20
15
10
5
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
Mlbs Cu
Cu prod (mlbs)
Cu sales (mlbs)
source: company filings
As copper makes up over 80% of the revenues
mix at CMMC, the extra grade (right) the
company has been enjoying has made a
difference. As for the rest of 2021, CMMC gave
some fairly specific guidance, with production
expected to emulate 4q20 more than 1q21,
before moving higher. However, that still means
23m lbs copper per quarter and more once the
new ball mill equipment comes online in 4q21.
Today is about financial expectations, so we’ll
cover all bases by showing the sales figures for
the two other payable metals, gold and silver.
Gold covers around 15% of revenues:
CMMC: Gold sold, per quarter
5
7217 2296 8946 0026 9316 9947 0366
9598
7818 0057 0057 0008
10000
9000
8000
7000
6000
5000
4000
3000
2000
1000
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
Oz Au
source: company filings, IKN ests
CMMC: Silver sold, per quarter
08226 70756 52275
32668 61008 62168 81418
439441
484061
000031 000031 000031
180000
160000
140000
120000
100000
80000
60000
40000
20000
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
CMMC: Mill head grade, per qtr
Oz Ag
source: company filings, IKN ests
Silver is a small revenues input at CMMC, covering between 3% and 5% of sales and even the
big spike for 1q21 returning a gross of under $5.3m. We model a flat production and sales that
brings $3m to the top lines for the rest of 2021 quarters. As for costs, this chart shows how
1q21 was an exceptional quarter, with out-sized sales and unaffected costs. The chart outlines
our expectations for the rest of the year and with 2q21 nearly done, our best guess on average
sales at U$4.30/lb will not be far from reality.
43.0 82.0 03.0 92.0 82.0 62.0 13.0 03.0 82.0 92.0
04.0 24.0
% Cu
0.50
0.45
0.40
0.35
0.30
0.25
0.20 0.15
0.10
0.05
0.00
2q183q184q181q192q193q194q191q202q203q204q201q21
source: company filings
CMMC: Received copper price vs. AISC Cu/lb produced
31.2
77.2
37.1
18.2
78.1
58.2
58.1
27.2
82.2
56.2
72.2
76.2
41.2
85.2
76.1
34.2
34.1
79.2
85.1
53.3
64.1
9.3
2
3.4
2
4
2
4
5
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
U$/lb
Cu AISC U$/lb
Cu received price U$/lb
source: Company filings, IKN ests
For the rest of 2021 we assume copper prices at just U$4.00/lb, even lower than today. As for
costs, CMMC has made some specific noises
recently on how it expects overall costs to come
in at the higher end of its $1.80/lb to $2.00/lb
guidance for the whole of 2021. Once we take
into account the low average costs of 1q21, it
implies a significant hike in AISC/lb and as a
result, we err to the side of caution and assume
a flat $2/lb for the rest of the year, even as the
ball mill comes online in 4q21.
The result of the impressive sales and averages
of 1q21 are see most clearly when we arrive at
the P+L. Here is our quarterly earnings
overview chart, to set the scene:
CMMC.to: Quarterly Earnings overview
180
160
140
120
100
80
60
40
20
0
-20
6
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
source: company filings, IKN ests
srallod
fo
snoillim
revenues
COGS
Gross profit
The top line revenue of C$162.207m was so far in front of my house estimate of C$133m that it
was slightly embarrassing, though that’s to do with the extra head grade and catch-up sales
and couldn’t have been predicted easily. But the information is now known and forecasts for the
rest of the year more straightforward, particularly if you do as we do and go with conservative
inputs. In 1q21, CMMC returned a record gross profit of C$96.28m, which becomes $85.503m
in operating profit once a heavier than normal G&A, plus $5m in share payments, are factored
in:
CMMC.to: Operating profit
3.3 7.61
1.21-
8.4 9.91 5.1-
4.5-
2.05-
0.81-
8.82 3.93 5.04
1.58
0.46 0.65 0.26
120
100
80
60
40
20
0
-20
-40
-60
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
source: company data, IKN ests
srallod
fo
snoillim
CMMC: AISC/lb Cu in USD, per qtr
From there, CMMC filed a net profit of $52.118m, representing a quarterly EPS of 25c. Those
are out-sized profits and we shouldn’t expect the same from the company in current and future
quarters. However, the compelling part of this proposed trade is how there’s no need for a
repeat of 1q21 to see CMMC move higher again. More than bottom line results, what matters to
a growth story such as CMMC with organic pipeline projects to fund is continuation, with
guaranteed operating earnings and free cash flow. This chart tracks operating EPS and even by
87.1 31.2 37.1 78.1 58.1 82.2 72.2 41.2 76.1 34.1 85.1 64.1 00.2 00.2 00.2
2.50
2.00
1.50
1.00
0.50
0.00
81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
U$
source: CMMC filings
assuming U$4.,00/lb for the rest of the year, then crimping theoretical gross margins even
further by assuming a sharp U$2.00/lb AISC, the forecast model still returns 30c per quarter in
operating EPS.
CMMC: Operating EPS, per qtr
0.50
0.40
0.30
0.20
0.10
0.00
-0.10
-0.20
-0.30
7
71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3 tse12q4
source: company data, IKN calcs
retrauq
rep
erahs/$C
The total for the last four columns as seen is C$1.29. That’s a reasonable and easily attainable
annual profit target for the company today, there’s no reason why it should deliver that sort of
cash to treasury and then, from there, to whatever asset development project it prefers.
But most impressive of all is to compare the above with the reality of CMMC this weekend, as
even with our lowball conservative parameters we arrive at a 2.6X multiple to market cap.
Compare that to profitable and stable precious metals mining companies that demand a
P/EBITDA of at least 8X, or 10X to 12X for the larger concerns, or to other base metals miners
that still get at least 4X and should get 6X once mature.
Due to the selling last week and even if we assume the price of copper continues to drop to
average U$4.00/lb for the rest of the year, CMMC trades at nearly half the price of peers. That
would be understandable for a financially weak company, but that is no longer the case here as
its balance sheet has improved beyond all measure. To cover that subject briefly this assets
overview chart (below left) shows how CMMC is all about adding cash to treasury:
CMMC: Assets breakdown, per qtr
1000
900
800
700
600
500
400
300
200
100
0
Liabilities look like this (above), with long-terms up due to a new closure bond escrow, a non-
cash effect. Apart from that, in-line and we expect them to start making good on their 2021
ambition to pay down debt and strengthen the balance sheet. It may be long overdue, but
considering the type of free cash flow CMMC is projected to throw off in the quarters to come.
it’s going to become difficult to justify not paying it down. We should also factor in last week’s
slide in the Canadian Dollar, which beat 0.83X recently and had me thinking about upcoming
changes to the standard house forex. This weekend sees the CAD/USD pair back to 1/0.8 (or
abouts) and right on our house assumption, it’s also less than a penny away from the forex
CMMC booked at the end of 1q21. That’s important for this company, what with it operating
and reporting in Loonies but holding its debt in USD. The recent rise in the Loonie may have
created an impression that the balance sheet would look stronger at the end of this quarter (i.e.
71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
C$m CMMC.to: Liabilities Breakdown per qtr
500
cash&eq A/C Rec 450 Inventory fixed
400
350
300
250
200
150
100
50
0
source: CMMC filings
71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
source: company filings, IKN ests
srallod
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snoillim
LT debt
current debt
fewer Loonies of debt to cover the Greenback total). In turn that illusion disappearing may be
one of the reasons CMMC fell more sharply than its peers last week, as quants running
comparative metrics would view CMMC’s balance sheet as deteriorating more rapidly than
peers. Finally, on this quick spin around a vastly improved balance sheet, working capital:
100 CMMC.to: Working Capital per qtr
80
60
40
20
0
-20
-40
-60
-80
-100
-120
8
71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
source company filings, IKN ests
srallod
fo
snoillim
Liquidity issues are history: CMMC has collected $137m in treasury cash and the flow would not
have stopped during 2q21, this company has brought its ducks in line at the right time and is
now a licence to print money.
With basic balance items covered we return to the reason to buy CMMC, its cash flow. Even if
we round down, make the math easy and assume CMMC is good for 30c/quarter, it would need
a share price of $3.60 to get back to 3X earnings. That’s still a rock bottom valuation multiple
for this company, even 4X is a low number and that suddenly gives us a $4.80 price target.
That’s the minimum amount of upside we can expect in the near future from CMMC and already
a 40% upside to this weekend.
In fact, it is the centre of this compelling value proposition, as even if copper drops further and
averages $4.00/lb for the rest of 2021 CMMC has a 40% upside to enjoy. This stock is trading
so cheaply it beggars belief and by using our lowball framework that assumes deteriorating
copper prices and higher costs per pound, we leave potential surprises are to the upside.
Here’s a quant of that potential, a table with CMMCs price target sensitivity to copper that
sketches out what we can expect as copper prices rise and fall. We assume a model production
year of 90m lbs copper, selling all wares at exactly U$4.00/lb, with a baseline sensitivity
therefore set at U$360m and other variables kept equal (207.5m shares out and standard
house forex of 0.8/1). The resulting table shows the difference a 25c/lb move in copper makes
to company revenues and EPS, then to the share price target at a low 3X operating earnings
even though CMMC trades this weekend even lower, at 2.6X). We also add a more reasonable,
though still low, 4X op earnings:
CMMC.to: Cu price sensitivity in FY21 At 3X op At 4x op
assuming production of 90m lbs Cu earnings earnings
Cu avg (U$/lb) est Cu revs U$m in C$/share effect on PPS effect on PPS
3.50 315 -0.27 -0.82 -1.09
3.75 337.5 -0.14 -0.41 -0.55
4.00 360.0 0.00 0.00 0.00
4.25 382.5 0.13 0.40 0.54
4.50 405 0.27 0.81 1.08
4.75 427.5 0.41 1.22 1.62
5.00 450 0.54 1.62 2.16
source: CMMC filings, IKN calcs
If copper were to drop a lot further from here and re-take U$3.50/lb, CMMC shares will
obviously hit trouble. That’s the risk on the trade, but downside is limited from this weekend’s
discount. As for the potential upside, a re-cap:
At U$4.00/lb copper, we expect CMMC to average operating earnings of 30c/share.
This represents a 2.6X multiple to the share price and significantly undervalues the
company
At a more reasonable, peer-level valuation of 4X operating earnings CMMC values at
C$4.80/share, representing an upside of 40% to this weekend’s share price.
However, CMMC shows strong upside with higher copper prices. As one example, we
can expect another $1.08 added to the basic $4.80 price target if copper averages
U$4.50/lb this year.
Tomorrow Monday morning, we will have the opportunity of buying a highly profitable and fast
growing copper producer at under 3X operating earnings. We shouldn’t expect the window to
last long, as even if copper continues to drop Copper Mountain has a clear 40% upside to this
weekend’s share price. As we assume copper will rebound sooner rather than later, that 40% is
just the beginning. Copper Mountain (CMMC.to) will return to the IKN Weekly ‘Stock to Follow
list, as from next weekend with no formal price target, as its eventual success will be deter
mined by the price of its metal.
Stocks to Follow
There was no escape from the selling for the house portfolio and my back pocket is lighter this
weekend, in virtual terms at least. Just one winner, as Aurelius (AUL.v) managed to buck the
trend and finish up a penny. No UNCHes this week therefore means 14 losers and while several
of them were minor in nature and inside current trading ranges (e.g. SMD.v, QCCU.v, WLF.v,
ECR.v etc), the portfolio got whacked all the same and a list the bigger losers would be a
downer, let’s simply note that last weekend there were just four trades out of 16 in the red, this
weekend that’s eight red out of 15.
company Ticker this week Avg Price Reco date Current PPS Gain/Loss% Notes
TOP PICKS
Minera Alamos MAI.v STR BUY C$0.21 13-Oct-19 C$0.64 204.8% $1.14 tgt Aug'20, #1 idea
Rio2 Ltd. RIO.v STR BUY C$0.83 22-Apr-18 C$0.76 -8.4% $1.58 tgt, finance capex due
Recommended stocks (In order of preference)
Trilogy Metals TMQ BUY U$1.84 15-Sep-19 U$2.43 32.1% Cu for 2021, going well
Amarillo Gold AGC.v BUY C$0.32 30-May-21 C$0.305 -4.7% add now, capex deal soon
Strategic Metals SMD.v STR BUY C$0.42 31-Jan-21 C$0.405 -2.4% Canadian land asset bet
Excelsior Mining MIN.to STR BUY C$0.93 10-Mar-19 C$0.60 -35.5% Delayed, but still great value
Aldebaran Res. ALDE.v BUY C$0.68 16-May-21 C$0.59 13.2% Bet on big copper, pol risk okay
QC Copper &Gold QCCU.v STR BUY C$0.205 25-Apr-21 C$0.205 0.0% Cu Jr, fast-tracking resource
Royal Road Min. RYR.v BUY C$0.155 17-Mar-19 C$0.325 109.7% Model paying off in Nica
Wolfden Res. WLF.v spec buy C$0.30 11-Apr-21 C$0.32 6.7% Zn trade needs to move soon
Great Bear Res GBR.v BUY C$15.83 26-Aug-20 C$14.88 -6.0% Binary M&A trade, wait for print
Cartier Resources ECR.v hold C$0.32 21-Mar-21 C$0.295 -4.7% Binary M&A trade, wait for print
Aurelius Min. AUL.v spec buy C$0.75 28-Jun-20 C$0.54 -28.0% has until its 43-101 to improve
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.075 -61.5% CEO change will move stock
Long-term non-mining hold
Mene Inc. MENE.v LT Hold C$0.62 6-Dec-20 C$0.61 -1.6% LT bet on jockey&horse,will add
9
Closed in 2021 closed close price
Fiore Gold F.v jan'21 C$0.98 21-May-20 C$1.17 19.4% closed as part of rebalance
Norsemont Mining NOM.cse feb'21 C$1.55 6-Sep-20 C$0.70 -54.8% Cut loser to reduce Au exp.
Element 29 Res ECU.v feb'21 C$0.49 7-Feb-21 C$0.54 10.2% Cut Peru exposure
Kuya Silver KUYA.cse feb'21 C$1.66 8-Nov-20 C$2.51 51.2% Cut Peru exposure
Pucara Gold TORO.v apr'21 C$0.65 4-Oct-20 C$0.26 -60.0% Cut loser, Peru risk call
Copper Mountain CMMC.to apr'21 C$1.40 22-Nov-20 C$4.18 198.6% tgt hit, profit taken
New Gold NGD may'21 U$0.76 9-Feb-20 U$2.14 181.6% Sold to buy AGC, nice win
Orezone Gold ORE.v jun'21 C$0.79 21-Jun-20 C$1.61 103.8% sold on pop, leaky boat
2015 to 2020 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Now for notes on some of our covered stocks:
Amarillo Gold (AGC.v): ADDING: Even though AGC isn’t at a big discount compared to last
weekend, this is the right price to add. This is the lowest price we can reasonably expect for
Eric Sprott’s next gold mine, as explained in the NR AGC delivered to market last Wednesday
(1). AGC took the opportunity to explain its current share structure and what warrants remain
out (i.e. the Eric Sprott batch) and after going into the weeds a little, we get pay dirt:
“The total number of shares outstanding as at June 16, 2021 is 383,868,754.”
That fits closely with our best guess for end 2q21 (was 382.1m without the broker warrants)
and means that indeed, AGC has benefitted from the exercise of all the 30c warrants.
500 AGC.v: Shares Out
450
400
350
300
250
200
150
100
50
0
10
41q4 51q1 51q2 51q3 51q4 61q1 61q2 61q3 61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 tse12q2 tse12q3
source: company filings
serahs
fo
snoillim
AGC with more cash and now, Eric Sprott must buy in again of he wants to retain his 19.99%
strategic. But details aside, AGC is now just one financing decision away from green-lighting its
mine and with meaningful upfront cash to get the ball
rolling. There’s no longer any need to try and suppress
the stock to under 30c, therefore Eric Sprott will desist
and that makes our current price an obvious floor. As
for the upside, from here to October AGC should have
re-rated into a developer and building its mine at Mara
Rosa.
Even with the planned purchase of CMMC, it would be
remiss not to add at least some this week at my target
price, with a view to getting the cost average down a
penny to 31c.
Copper Mountain (CMMC.to): Buying. A quick line here to confirm and make sure you all
see my plans for this trade.
Royal Road (RYR.v): One good one bad for RYR, starting with the good news and with the
$20m sale of its 50% of Luna Roja complete, this junior is in an enviable treasury position that’s
the envy of its peers. With budgets for the foreseeable future covered easily, including the long-
term work commitments with Mineros SA, CEO Coughlin could even entertain thoughts of
strategic incursions into other companies if desired.
Meanwhile to the negative the recent uptick in political unrest in Nicaragua plays against the
company, as the autocratic Ortega government (now often powered by his wife Rosa Murillo)
has made slew of unexpected and arbitrary arrests of opposition political figures in the last few
days. The move seems to be pre-emptive and about keeping next year’s Presidential election
under the complete control of Los Ortega, presumably the arrested people will no longer be
eligible for office in some way or form. All this reflects poorly on the country and may cause
headwinds to RYR’s share price as the weeks turn toward next year’s election.
Aldebaran Resources (ALDE.v): Another that bargain hunters may consider picking up is
ALDE, its price now back to where it was first mentioned on these pages as great value in the
rest of 2021. ALDE came back with drill result on Tuesday June 15th (2), the headline return
being (and we quote)… “…63 m of 0.94% CuEq in near surface supergene mineralization, and
584 m of 0.52% CuEq, including 158 m of 0.71% CuEq, in hypogene mineralization, extending
the hypogene zone approximately 150 m to the west and 500 m below the current resource
estimate.”
That’s a good hit, but even with the implied step-out of resource the grade is nothing out of the
ordinary for Altar. ALDE has two more drill holes in the labs from the current campaign and we
expect them to get back up and re-start programs by September, once the worst of the
Cordillera winter is done. From that point we should get steadier newsflow, but the real reason
to buy ALDE is its scale and size as a project in times of copper scarcity.
QC Copper & Gold (QCCU.v): I noted with interest a few comments made by Warren Irwin
through a couple of media market channels. He is not to my knowledge long this stock and
neither is he likely to be, as one of his tips
for newcomers in last week’s webinars
was to “make sure you have grade and
scale” for any copper junior. That’s true to
a certain extent, as majors are going to be
interested in the largest of copper (and
other) deposits in order to move their dial,
but scalability becomes less of an issue
when your small project is part of a camp.
Indeed, Opemiska as a previously mined
operation may get first mover advantage
over local rivals in the Chibougamau
region. In trading, QCCU held up well
enough and the 20c line looks strong.
Rio2 Ltd (RIO.v:) Our Top Pick still hasn’t given up its financing news and, like AGC above,
isn’t going to move seriously until the package is known and agreed upon.
The Copper Basket
After twenty-four weeks of 2021, The Copper Basket shows a gain of 33.35% to level stakes.
11
company ticker price 1/1/21 Shares out Market Cap current pps gain/loss%
1 Solaris Res SLS.to 6.08 107.53 1204.34 11.20 84.2%
2 Copper Mtn CMMC.to 1.81 207.5 711.73 3.43 89.5%
3 Oroco Res OCO.v 1.85 186.96 605.75 3.24 75.1%
4 Marimaca Cop MARI.to 3.25 87.737 359.72 4.10 26.2%
5 Western Copper WRN.to 1.57 135.798 347.64 2.56 63.1%
6 Amerigo Res ARG.to 0.80 181.79 214.51 1.18 47.5%
7 Excelsior Min. MIN.to 1.12 273.585 164.15 0.60 -46.4%
8 Regulus Res. REG.v 1.07 101.85 78.42 0.77 -28.0%
9 Aldebaran Res. ALDE.v 0.455 125.24 73.89 0.59 29.7%
10 C3 Metals CCCM.v 0.115 438.56 72.36 0.165 43.5%
11 Doré Copper DCMC.v 1.00 53.304 48.51 0.91 -9.0%
12 Element 29 Res ECU.v 0.45 68.281 35.51 0.52 15.6%
13 Chakana Cop PERU.v 0.60 111.41 31.19 0.28 -53.3%
14 US Copper USCU.v 0.105 87.53 16.63 0.19 81.0%
15 Chibougamau CBG.v 0.165 53.077 15.92 0.30 81.8%
NB: All stocks in CAD$ Portfolio avg 33.35%
The big correction arrives. The Copper
The Copper Basket 2021, weekly evolution
Basket average dropped 12.5% percent last 70%
week and is back to levels last seen at the
60%
start of May when the metal had reached
50%
U$4.50/lb, all a week or so before the big
40%
Goldman Sachs pump.
30%
Notably, it wasn’t all bad news for the 15 20%
component stocks with two of them 10%
managing to return gains (ECU.v, CCCM.v). 0%
However, the other 13 were all losers and
some were big losses too, led by US Copper
(USCU.v down 20.8%) and followed by
Chakana (PERU.v down 15.2%), Copper Mountain (CMMC.to down 17.6%), Aldebaran (ALDE.v
down 14.5%) and Western (WRN.to down 10.5%).
The catalyst was China, which not only made good on its recent talk to free up strategic metals
reserves, but made a public show about it. China also released data to show their
manufacturing base isn’t running as smoothly as they would like, for example auto production
in May slipped by 4% compared to the same month of 2020: The reason seems to be a lack of
semiconductors needed for the control systems for cars. Then came Thursday and the US Fed’s
change of narrative; Changing rate increase expectations to 2023 instead of 2024 was classic
Fed jawbone and once again demonstrated who is in charge (and that nobody is fighting them).
The result is this copper chart:
12
ts1
naJ
t01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 n2yam ht9 ht61 dr32 ht03 ht6nuj ht31 ht02
source: IKN calcs
The price levels for resistance are clear enough, not need for any extra squiggly lines and if
copper does break under U$4.00/lb, not only would I be surprised but I’d be poorer. Until such
time however, risk continues to the upside and nobody in their right mind should call last week
the end of the copper bull. Now for our regular weekly copper inventories coverage, data from
Chile’s Cochilco, with its own bullish message:
World copper stocks were whacked, launched higher by an inventory dumpage from
the only place in the world with the muscle and inclination to get metals prices lower.
Total aggregate stocks rose by 25,612mt to reach 390,224mt this weekend, still under
the 400k line and still in a tight market.
At the SHFE, stocks dropped by 8,420mt to close at 172,527mt, confirming the trend
lower as the de-stock period of the year kicks into gear.
The action was all LME. Last weekend we noted cancelled warrants down to under 10%
of inventories, suggesting a pause in outflows. That, combined with the way China
landed 23,650mt of copper at LME warehouses in Rotterdam, 6,500mt in South Korea,
another 4,000+ tonnes in other LME Asia warehouses and even 2,200mt in Germany,
made last week’s copper action and once the dust had settled, LME copper stocks had
risen by 36,225 metric tonnes (mt), or up 27.3% on the week.
The COMEX inventories dropped by another 2k+mt and at some point, its modest
influence on North American copper supply should begin to show. Supply is tight
everywhere, the slack is taken up. Stocks lost 2,173mt to close the week at 49,022mt.
Here’s the Shanghai-only inventories chart. Another 8k lost on the week which went largely un-
noticed under the dumpage from China onto the LME, but that doesn’t change its influence:
Shanghai Futures Exchange Warehouse Stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
13
ht5naj ht61 ht52 dr3gua ht21 ts12 5102
ts1ram
ht01 ht91 ht72 ht6ced ht41 ht42 6102
dr3luJ
ht11 ht72 ht5beF ht61 ht52 7102
dr3pes
ht21 ts12 8102
ts1rpa
ht71 ht62 8102
ht4von
9102
ht31naj
ht42 9102
dn2nuj
ht11 ht02 ht92 ht8 ht71 0202ht62luj ht4tco 0202ht31ced ts12 1202dn2yam
Mt Cu
|
source: Cochilco
Everything about last week’s attack on copper says “temporary hit”, rather than any trend
change and the SHFE inventory drop tells us that
demand for the metal is still high on the Asia
mainland. Now for notes on basket stocks:
Chakana Copper (PERU.v): Hardest hit of all our
Peru juniors, PERU.v now has a chart that becomes a
self-fulfilling prophecy:
Though no fan of TA, enough gets through my head to
understand how any trader willing to bet $20k or $50k
on a near-term flip would take one look at that chart
and say “wait for 20c”.
Element 29 (ECU.v) and C3 Metals (CCCM.v): Although I’d sleep better at night knowing
each and every reader of The IKN Weekly had no Peru junior mining exposure in their portfolio,
there’s no accounting for taste and I know some are bargain-hunting in the Peru junior space.
So for those brave enough to buy Peru, the best spot for exposure today would be a small
exploreco that is cashed up and permitted to advance its project. They are the companies least
affected by tax hikes and if they have the funds to
cover the initial rough and uncertain period, they will
be fine. Examples include C3 Metals (CCCM.v) and
Element 29 (ECU.v) and while the former is more of
a Vancouver promotional vehicle, ECU.v today ticks
the boxes for cash, permits and experience as well as
being able to benefit from true long-term CSR
practices at its Elida project.
However, once you start travelling from the perfect
triumvirate of “Exploreco, Cashed-Up, Permitted”
Peru gets unattractive quickly. The main problem will
be market perception, as fewer people expose their
portfolios to its new Left wing politics, so Peru juniors with a need to raise cash either now or in
the near future are in a position of weakness. We’ll also get to find out the truth about some of
the Community Relations around certain projects, the level of emancipation running through
provincial and upland Peru could bring revelations of wrongdoings that locals were previously
nervous to talk about (e.g. Fortuna Silver at Caylloma, which fortunately for them is a minor
part of the company’s overall asset mix these days. Another example would be Hannan Metals
in the North, as only the naïve could think that company could control that much concession
bloc without raising hackles in a zone notorious for its antipathy toward natural resource
industries.
The Producer Basket
After twenty-four weeks of 2021, the Producer Basket shows a loss of xxx% to level stakes.
company ticker price 1/1/20 Shares out Mkt Cap (U$Bn) current pps gain/loss%
1 Newmont NEM 59.89 805 50.41 62.62 4.6%
2 Barrick GOLD 22.78 1778.04 36.89 20.75 -8.9%
3 Agnico Eagle AEM 70.51 244.187 15.33 62.77 -11.0%
4 Kirkland Lake KL 41.27 267.056 10.34 38.73 -6.2%
5 Kinross Gold KGC 7.34 1261.07 8.10 6.42 -12.5%
6 Endeavour Min EDV.to 29.62 252.568 6.21 29.50 -0.4%
7 Pan American PAAS 34.71 210.262 5.94 28.24 -18.6%
8 B2Gold BTG 5.60 1051.697 4.60 4.37 -22.0%
9 Alamos Gold AGI 8.75 392.739 3.06 7.79 -11.0%
10 Pretium Res PVG 11.48 187.833 1.84 9.78 -14.8%
Prices in U$ except EDV.to (share price in CAD$ and mkt cap in approx USD) Port. avg -10.08%
We dive back underwater with last week’s sell-off, all ten of our charges were losers and eight
of those drops were by 10% or more. It was heavy, top-down selling from large money
invested via GDX (and the others), the uniformity of the losses indicative of the main driver.
Seven of our ten lost between 10.2% and 11.9%, the only outliers Kinross (KGC down 17.8%)
to the bad side and Pretium (PVG down 7.0%) and Endeavour (EDV.to down 2.0%) to the
The 2021 Producer Basket: Weekly performance and 20%
comparative to GDX control
15%
10%
5%
0%
-5%
-10%
-15% 14
-20%
ts1
naJ
t01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 n2yam ht9 ht61 dr32 ht03 ht6nuj ht31 ht02
The 2021 Producer Basket: Percentage difference between
GDX benchmark and basket (negative = IKN basket ahead) 7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
basket
gdx control 0.0%
source: Google, IKN Calcs ts1
naJ
t01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 n2yam ht9 ht61 dr32 ht03 ht6nuj ht31 ht02
source: IKN calcs, NYSE/Nasdaq/TSX data
least-worst side. Here are our tracking charts and our basket made up a little of the lag last
week, thanks mainly to having those two least worst companies on the list. The overall damage
to the main benchmarks on the week was GDX down 10.8%, GDXJ down 10.3% and gold
bullion’s GLD down 6.15%. Heavy.
Here’s a comparative chart of our three standard
benchmarks, used in other sections of the Weekly as
well as for GDX here. The sellers had already taken
control by the time the Fed dropped its semi-sleeper
decision, so even though the leg down Thursday was
sharp (and painful), the line then held. The more
concerning image from this minute interval five day
chart isn’t the way they legged down at the open on
Thursday, or even Friday, but the selling into the
close. On the other hand, it’s only a worry up to a
certain point as this “concern” is the same reason I
was chuckling at the screen while watching Copper
Mountain get sold down under C$3.50 once again.
Kinross (KGC): The way Kinross fails repeatedly at the U$10Bn market cap valuation, around
the U$8.00 line today, is significant. This chart details the failed breakout of mid-2020 which is
largely the same as other companies, then three failures at the same eight line which is not.
It’s as if the market can’t stand the thought of having to take this serially bad company more
seriously, which happens at 12-digit valuations.
StreamerWatch: After last week’s sell-off, we catch up with our three examples of small,
medium and large-sized streamer/royalty companies versus the market in 2021:
The small Metalla (MTA.v) had a tough time in Q1, but has steadied the boat since then and
performed better than peers last week. As for medium (SAND) and large (FNV), they sold with
the market but from a higher baseline. That approximate 20% buffer held last week, which
15
means both are still out-performing the market and positive for the year.
The Tiny Dogs
After twenty-four weeks of 2021, the Tiny Dogs show a loss of 3.42% to level stakes.
company ticker price 1/1/21 Shares out Mkt Cap current pps gain/loss%
Antler Gold ANTL.v 0.205 61.348 8.59 0.14 -31.7%
Aston Bay BAY.v 0.045 163.975 7.38 0.045 0.0%
Constantine Met CEM.v 0.17 45.4 10.90 0.24 41.2%
Contact Gold C.v 0.115 240.757 21.67 0.09 -21.7%
Golden Pursuit GDP.v 0.22 40 5.20 0.13 -40.9%
Manitou Gold MTU.v 0.045 230.79 17.31 0.075 66.7%
Precipitate Gold PRG.v 0.240 106.241 13.28 0.125 -47.9%
QC Copper QCCU.v 0.315 105 21.53 0.205 -34.9%
Red Pine Expl RPX.v 0.400 95.806 62.27 0.65 62.5%
Warrior Gold WAR.v 0.090 91.818 5.97 0.065 -27.8%
Prices in CAD$, data from TSXV basket avg -3.46%
This section attempts to track the tinycap mining sub-sector of the market, our ten companies
chosen under the following criteria to put together a list representing the state of play in the
sub-sector of tinycap exploration company stocks. At least, that’s the plan.
Market capitalization of under $20m. They have to be tiny. In two cases I’ve stretched the window a
little and allowed sub-U$20m market capper in that are just over the C$20m level, but the spirit is unaltered.
A “non broken” stock price and project story. There are literally hundreds of tinycap juniors of the right
size, but it was a particularly depressing exercise to trawl through the whole of the TSXV and find companies
that are small enough, but with life in them. The vast majority of sub-$20m stocks are broken stocks, either
traded to death on the exchange or with projects that are a bust or with entrenched management more
interested in their monthly paycheck than anything else.
Likelihood of meaningful newsflow in 2020. This connects to the company’s “unbroken” status, as we
want news and potential catalysts from companies with projects that can work.
Decent management if possible. When you are down among the little guys it doesn’t pay to be too
choosy, but still I preferred companies that have teams or people with good peer reputations.
There is no escape, not even in the tinycaps as our
basket average drops below zero for the first time in
2021. There was one winner (ANTL.v) and one
unchanged (GDP.v) on the week, the other eight lost
ground and while there were no catastrophic losses,
the general selling across the board was enough to
drag the average underwater. A reminder of context as
the gold, silver, mining and junior ETFs were already
struggling for the year, it took until now for the small
fry to join them.
Red Pine (RPX.v): The biggest slippage of the week,
down 14.8% and unsurprising. This is the stock that’s
now only Tiny Dog in name, the corporate re-working and structure funding for the Wawa
project ballooning its market cap to way over our normal U$20m ceiling. With instos and retail
now trading RPX as a normal-sized junior with reasonable daily traded volumes, it’s no surprise
to see the recent merger premium come out the stock on
last week’s gold drop.
If you are like me and appreciate the growing interest in
the Gondreau (sp?) geological trend (Island Gold, Eagle
River, Magino) RPX should also be on your watchlist, as
should fellow tinydog Manitou (MTU.v), which has found
16
very high grade intersects over the years but not the continuity required to make a mine.
NB: Please be clear that The Tiny Dogs is NOT a list of recommended tinycap stocks. It is a list of companies with
market caps of under $20m offering a reasonable representation of the wider tinycaps market. It is possible that in the
future I may buy shares in one or several of these stocks, but at the moment both my opinion and my wallet are strictly
neutral.
Regional politics
Argentina: Chubut’s Zonification” law project now dead in 2021
It took a lunch meeting of Peronist Party (PJ) officials with Chubut union leaders on Monday for
reality to finally sink in about the “Zonification” law project that would permit Pan American
Silver’s Navidad project. At the lunch, union leaders keen on advancing the mine project were
told by local politicos that the subject was a vote loser and that any parliamentarian seen
supporting the law would be in danger of losing their seat in the 2022 regional elections. At that
point, union leaders finally saw the real reason behind the delay and now understand.
Therefore, even though the law project got a boost last week from a legal ruling and even
though Chubut Governor Arcioni is still pushing the plan, it will now quietly die.
Argentina’s plan to “nationalize lithium”
More fun in Argentina last week, when early plans from the centre of the Kirchnerist PJ party
and a project backed by family scion and now member of Congress Maxi Kirchner were
revealed to declare lithium a “strategic national resource”. The implications run all the way to
nationalization of the sector and although the Fernandez government flatly denied any talk of
such extremes, it’s clear they have plans to control the production and export of the metal. To
quote this report (3), the project is, “…doing the rounds of the Ministry of Production.
Specifically, Mafias Kulfas (the so-called “Super-Minister” of Productive Development) has been
working with several companies so that there isn’t just lithium mining in Argentina, but also
production here. There could be batteries for Toyota, for example.”
An example of how crazy things happen in The Basket Case Country by committee, this project
is tantamount to removing lithium from the hands of provincial governments and putting it into
the hands of the nation, something that provincial governors will not allow. However, by the
time this plan has been through committee and rolled out after the 2022 regional elections it
would have been watered down to something that will allow the nation to levy extra against the
metal.
Ecuador: A law project to ban mining in the whole of the country
A photo opportunity for Yaku Pérez last week as his party presented a law project to Ecuador’s
Congress that, if passed would ban metals mining in all its phases, from initial exploration to
eventual production, from the entire country. Here’s a translation from this (4): “The ex-
candidate for President, Yaku Pérez, in the name of (aforementioned) social groups, delivered
the document to the Vice-President of the National Assembly,
Virgilio Saquisela, and demanded that it be moved into law in
order to detain extractive activities that have ruined lands,
invaded territories, split communities and polluted the
environment.”
The fractured nature of Ecuador’s new Congress (see right for a
brief visual reminder) means neither government nor opposition
will get everything they ever want on hot button issues, this is a
case in point. However, with the Yaku Perez Pachakutik
currently holding the presidency of Congress that party also get
to set the agenda, which means this bill won’t die in committee
room. The issue is not the spectre of a blanket ban on mining in
Ecuador, that’s unlikely to happen and, even if voted up by
Congress, would be vetoed by President Lasso. The problem is
that anything from this bill that gets out of committee, no
17
matter how watered down, will be bad news for mining in Ecuador. Yaku Pérez has shown
himself very adept at using the legal system in Ecuador to press his anti-mining case, this law
project is another example so the next time you hear the Ecuador mining sector downplay the
threat of the new law (WoodMac was very active in media channels last week), be clear the
whole industry is worried about this development and will watch its passage like a hawk.
The Mexico regional elections and mining
Last week’s regional and municipal elections in Mexico (5) were billed in the run-up as a
judgment day on AMLO and his MORENO party but, once the votes had ben counted, Mexico’s
President had again scored better than expected in all polls. The overall patchwork of Mexico
doesn’t allow a party to claim a clean victory, but as MORENO saw gains in plenty of provinces
including significant wins in mining States Sonora, Zacatecas and Guerrero, all of which with
new MORENO governors, it certainly was no defeat and overall, AMLO has come out stronger
from the mid-terms, an unusual situation for a sitting President’s party. This is, of course, the
same AMLO that The Economist called “a threat to democracy” in the run-up to the election.
Chile: The royalty law project is in committee
Easy to forget the ruckus that came out of Chile just a few weeks ago when a law project was
passed by the lower house to impose a 3% royalty on sales of copper and lithium in Chile. At
the time we noted its negative effects would be transitory and the law bill’s passage into reality
slow at best. Here were are ending 2q21 with the royalty in Senate committee and now, for
scheduling purposes, will stay that way until at least mid-July (6).
Our other prediction, that the royalty would look like a good deal compared to other resource
nationalism moves, is also making progress. Last week the leader of Chile’s powerful mining
union the FTC, which covers 75% of workers at the State-owned Codelco, sais that the 3%
royalty was “ a good start” but they were pushing for a 75% tax on private companies in Chile
and that Codelco be automatic JV leader in any new copper mine in the country (7). That’s the
type of State burden which would indeed affect Chile’s FDI outlook negatively, which is why it
won’t happen. However, the jostling for position as the debate process for the new Constitution
means all sides are eager to get their opinion heard.
This week in Peru
I’ve had plenty of mails this week, thank you all. This update will try to cover all the bases, but
above all the task is to explain that while Peru may look as though it’s in existential turmoil, the
current process is healthy and the likelihood of a smooth transition in power is now growing. To
get a good handle on the subject, I’d like you to read the whole of this accurate report on Peru
this weekend filed by Dan Collyns of The Guardian (8), but know most of you won’t search out
the link and use it. Therefore, some extended excerpts that start with its headline and frank
opening paragraph:
Peru: Fujimori cries electoral fraud – and unleashes torrent of racism
The prospect of the son of illiterate Andean peasants becoming president as his rival
cries fraud has shaken Peru’s entrenched class system and its fragile democracy,
letting loose a torrent of racism in the bicentennial year of the country’s independence.
I am aware these words are being read by an audience of gold owners and mining speculators,
not the socioeconomic cross-section that would normally read a left wing rag like The Guardian,
but this time I am asking you in first-person voice to suspend your disbelief because for one
thing it’s true, for another the outcome of this current spat will decide whether Peru becomes
investable in 2021. As for the voter fraud allegations, here’s some flavour from further down
the note:
In a move which illustrates the skewed playing field, Fujimori has recruited Lima’s most
expensive law firms to quash 200,000 votes, almost all from poor Andean regions
which voted overwhelmingly for Castillo.
“The tension has reached a breaking point,” said José Ragas, a Peruvian historian at
Chile’s Catholic University. “The Lima elite is not just trying to keep power – it’s not just
18
that they don’t want to recognise the victory of Pedro Castillo – but they are trying to
cancel the rural vote.”
Again, do your biases a favour and filter out phrases such as “Lima Elite”, which sing to the
normal audience of The Guardian. Adjectives are up for debate, the rest above is spot on and
to expand, I find myself with the need to go off-piste and interject some purely personal
observations: As those of you who know some of my history, my time in Peru was closely
associated with the highland regions from the start and, even after these latest years in a Lima
middle class comfort zone, most of my Peru has been in the South provinces at many
thousands of feet above sea level. Having experienced the spectrum of Peruvian socioeconomic
and geographical strata, up close and personal for many years, there’s not a doubt in my mind
regarding this subject. Neither will I over-exaggerate and accuse Peru of a racism that doesn’t
exist anywhere else; I underscore that active hatred of this sort is rare among our fellow human
beings, true for everywhere including middle class Lima. So with context clear, yes, it really is
like that here in Peru. Really. This is racism that goes back 500 years, not five or 50 and it’s not
going to disappear suddenly once Lima sees Pedro Castillo isn’t an uneducated brute and can
string an eloquent sentence together (An aside: he’s got notably better at public speaking in the
last couple of weeks). For good or evil, in my first period Peru I witnessed the way Lima treats
upland provincials, these days my neighbours are the policymakers and lazy Mark resigned
himself to “That’s that the way it is” a long time ago. Here’s some more from the article:
“…the online news site Sudaca published a private text messages between middle-
class white men in Lima who discussed how people from the highlands should “die of
hunger” and called for the return of Alberto Fujimori’s alleged forced sterilisations
which mostly targeted indigenous women.
Other social media memes characterised Castillo as a donkey or said Andeans were
too ignorant to be allowed to vote. They echo old “racist and classist attitudes ingrained
in the national and social debate,” said Ragas. But social media has given such
comments a much bigger audience, he said.”
That is not exceptional. The Sudaca report made news in Peru because its contents were nasty,
then went viral in Peru because the whole country recognized the traits. However, that final
sentence from José Ragas, a historian at the University of Chile, is also the reason why the
current situation and atmosphere allow optimism about the near-term future of Peru, rather
than pessimism. This desk make some clear predictions:
The current rarefied atmosphere, as depicted by Mr. Collyns in his insightful report, will
soon calm.
Peru electoral body, the JNE, will not find enough evidence to support claims of fraud.
Pedro Castillo will become President on July 28th, on schedule.
Keiko Fujimori will then be in a whole world of problems.
In other word, expect a little (relative) calm before the next storm, a few months down the line.
Once the inauguration is done we are still in for a lot of serious bickering and arguments, the
highly-charged political arena will continue and the scenarios outlined last week of Congress
refusing to play ball are still possible, but they are now less likely because Peru’s version of the
thuggish right (known locally as “DBA”, derecho bruto achorado, which translates as right wing,
brutish and insolent/challenging) has overplayed its hand. Professor José Ragas may not like its
message of hatred and racism toward de-facto President-Elect Pedro Castillo, but he’s enjoying
the speed at which they are revealed. The cultural clashes and revelation/confrontation of
generational-level ingrained racism in Lima society (word “Lima” chosen carefully) is coming to
a head now in June because it needs to, it’s way better than having it explode in July or August
once the President is installed. Peru is experiencing a bloodletting and the catalyst has been, for
the powers that control the country at least, an election combined with a nightmare version of
Murphy’s Law. From start to finish, everything that could have gone wrong has gone wrong and
that includes today, the thin margin of victory causing friction as Keiko Fujimori pushes
extremely flimsy accusations of fraud to the limit and demands the support of “her fellow
democrats”. It’s causing attacks of nausea among the chattering classes and the distaste felt
toward Castillo is now shifting, and markedly, toward a 360° disdain for Keiko Fujimori from all
parts of society. With Castillo a lock the blame game begins and one this occasion, the piñata
19
has been served up on a silver platter. For details, here’s the final excerpt from the Dan Collyns
note, you’ll be able to sketch between the details easily enough but what it’s worth, the 30 year
sentence mentioned in the text is the maximum possible from several charges. She may not get
them all, but 15 of those years are like predicting which day comes after Thursday:
As officials at Peru’s electoral board work overtime to reinspect the disputed ballots,
social media and partisan news broadcasters have helped spread fake news stirring up
the spectre of totalitarian rule, violence and even mass expropriations if Castillo is
declared the winner amid rumblings of coup plots among the far-right.
Apparently inspired by Donald Trump’s refusal to accept defeat at the US elections,
Fujimori has led a string of marches against “fraud” telling supporters at one rally: “The
election will be flipped, dear friends.”
The three-time presidential candidate has already spent more than a year in pre-trial
detention, accused of receiving more than $17m in illegal campaign funds and heading
a criminal organisation, and could face a 30-year jail term if convicted. She denies the
allegations.
On Friday, Peru’s interim president Francisco Sagasti slammed as “unacceptable” a
letter signed by nearly a hundred retired military officers urging the armed forces not to
recognise Castillo if he takes office. “They want to incite top commanders of the Army,
Navy, and Air force to break the rule of law,” he said in an address to the nation.
As tension – fanned by fake news – grows, José Miguel Vivanco, Executive Director
for the Americas, at Human Rights Watch, called on “all Peruvians – especially the
candidates, the public servants and the members of the security forces” to “respect the
electoral results which the authorities announce.”
Mr. Vivanco is right and that simple statement is slowly boxing Castillo’s sworn enemies into a
corner. They have shouted too loud, now Castillo gets to enact (watered down?) policies and
for the first few months at least, they won’t be able to stop him, short of doing something
highly illegal. His enemies’ hands overplayed, de-facto President-Elect Castillo can now expect
his ministerial cabinet to be ratified by the upcoming Congress (lots of abstentions, but he won’t
care). That will likely be headed by Verónika Mendoza as Prime Minister and full of left wing
politicos, it’s also why this desk much prefers to wait until August before re-considering Peru as
geography for a trade. To round off today’s anecdotal note and as my dad was one of the
people who asked (and today is Father’s Day), no I am not making active plans to leave Peru.
However, anyone who had their formative years in 1970s Europe understands what the word
“Communist” means and how such people or governments look upon critics of all types, so it’s
normal to think through a basic contingency plan. Up to now, the sum total of all plans are 1) a
very short list of possible landing countries and 2) a small hoard of US Dollar bills, enough to
leave quickly and find a roof somewhere. That’s all.
Peru: Julio Velarde is out at the BCRP
A heads-up on something more important than the noise and bickering from Keiko and her
lawyers last week: Head of Peru’s Central Bank for the last 15 years and the man who has kept
Peru on its sound monetary course all that time, this is what Julio Velarde said at his regular
monthly press conference (translated) (9), “No, I don’t know whether this will be my last
inflation report, it seems to my the next to last. The new Presidents, or new governors that take
over the Central Bank will take over between September and November, I personally came in
October (of 2006)…I could stay a while until they name a new President (of the Central Bank,
but it would be a question of months.”
In other words, he’s been quietly told by the Castillo camp, then given the diplomatic exit via a
friendly reporter at his scheduled presser. This means the Central Bank is going to a left wing
economist, possibly one Oscar Dancourt, but if not it will be someone of his ilk with left wing
politics and loose monetary policies that invite inflation in through the front door. With the left-
wing economist Pedro Francke, mentioned on these pages a few weeks ago, now expected to
become the first FinMin under the Castillo presidency the Lima left wing has done a lot of power
co-opting in the last seven days. Their idea of Utopia is to build a new Uruguay, my idea of a
prediction is Argentina-level monetary mess in three years. It’s worth underscoring the new
President inherits inflation from the outgoing administration no matter what happens; Peru
went deep into debt last year to pump itself financially out of the Covid-19 crisis and its fiscal
20
deficit is widening, with metrics such as debt/GDP deteriorated. That’s only going to get worse
now Velarde is out.
Market Watching
Deferred.
Conclusion
IKN630 is done, we end with bullet points:
Though it has several different sections and subject matter often varies, the only
reason to buy The IKN Weekly is for stock tips that make you money. Copper Mountain
(CMMC.to) this weekend is a stock tip that will make you money.
On the blog on Friday, I talked about banging the table on two stocks and not just one.
Copper Mountain is the base metals stock I had in mind, but after due consideration I
edited out a brief reprise note on last week’s feature company, Argonaut Gold (AR.to).
Although it’s also at a deep discount and a great purchase at any price around U$3.00,
the trade opportunity in Copper Mountain is an altogether more compelling one and will
carry my trade cash. AR.to is a great story, just not the right fit for me personal
portfolio today.
Peru is now going through its noisiest protest period and that’s good news, the storm
before the calm. Expect the handover to happen, expect Pedro Castillo to enjoy a brief
honeymoon period, expect taxes to be raised on mining companies and after that, we
shall see how thing stand.
Amarillo Gold (AGC.v) is now at the right price to accumulate. The Gretzky saying used
often in investment circles, “skate to where the puck is going to be”, becomes a lot
easier when you know the puck, in this case the build decision for Eric Sprott’s next
gold mine, is less than a quarter away. With such an advantage in knowledge, all we
need to do is skate slowly over to where the puck will appear, then wait.
I thank you in advance for any feedback. Our Top Pick stocks are Minera Alamos (MAI.v) and
Rio2 Ltd (RIO.v). Flash updates will be sent if required by events.
I wish you good trading fortune, ladies and gentlemen.
Best, Mark
21
Footnotes, appendices, references, disclaimer
(1) https://amarillogold.com/investors/news/news-details/2021/Amarillo-updates-share-capital-after-exercise-of-
warrants-and-options/default.aspx
(2) https://aldebaranresources.com/news-releases/2021/aldebaran-intercepts-63-m-of-0.94-cueq-and-584-m-of-0.52-
cueq-in-hole-ald-21-217-at-the-altar-project/
(3) http://www.elinversorenergetico.com/polemica-por-la-intencion-del-gobierno-de-intervenir-en-el-negocio-del-litio/
(4) https://www.sonorama.com.ec/2021/06/16/an-recibio-el-proyecto-de-ley-organica-de-prohibicion-de-mineria-
metalica-en-ecuador/
(5) https://www.elsoldehermosillo.com.mx/analisis/conversatorios-mineros-nuevos-gobiernos-colaboramos-
6848581.html
(6) https://www.df.cl/noticias/empresas/energia/royalty-minero-senado-calcula-que-el-debate-se-extendera-por-un-mes-
en/2021-06-16/195606.html
(7) https://www.df.cl/noticias/empresas/multinacionales/federacion-de-trabajadores-del-cobre-impulsa-un-impuesto-a-la-
mineria/2021-06-18/200644.html
(8) https://rpp.pe/economia/economia/julio-velarde-continuara-en-el-bcr-en-un-eventual-gobierno-de-pedro-castillo-esto-
respondio-noticia-1342972
(9) https://www.theguardian.com/world/2021/jun/20/peru-elite-election-pedro-castillo-keiko-fujimori
Stocks To Follow Closed Positions 2020
Closed in 2020 closed close price
TMAC Resources TMR.to Jan'20 C$3.41 20-Dec-19 C$3.61 5.9% TLS flip play, sold new year
Regulus Res REG.v Jan'20 C$1.10 20-Dec-19 C$1.30 18.2% TLS flip play, profit taken
Bonterra Res BTR.v Jan'20 C$1.90 9-Dec-19 C$1.66 -12.6% TLS flip play, loss taken
McEwen Mining MUX Jan'20 U$1.12 2-Dec-19 U$1.18 5.4% TLS flip play, profit taken
Core Gold CGLD.v Jan'20 C$0.255 7-Apr-19 C$0.305 19.6% arb trade, profit taken
HudBay Min HBM Jan'20 U$3.56 9-Dec-19 U$3.36 -5.6% TLS flip play, loss taken
Midas Gold MAX.to Feb'20 C$0.71 5-Jan-20 C$0.57 -19.7% sm & silly trade
Warrior Gold WAR.v Feb'20 C$0.08 3-Aug-18 C$0.05 -31.3% clean out non-perf sm stocks
Contact Gold C.v Feb'20 C$0.40 19-Aug-18 C$0.18 -55.0% clean out non-perf sm stocks
Sandstorm Gold SAND Feb'20 U$3.73 17-Apr-16 U$7.21 93.3% Sold during port rebalance
NexGen Energy NXE Feb'20 U$1.20 2-Dec-19 U$1.06 -11.7% TLS flip play, loss taken
MAG Silver MAG Apr'20 U$8.95 1-Mar-20 U$10.07 12.5% Sold to cut silver exposure
Alexco Res AXU Apr'20 U$1.69 7-Sep-17 U$1.69 0.0% sold to close Ag exp. in FY20
Bonterra Res BTR.v Jun'20 C$1.62 2-Feb-20 C$1.10 -32.1% under-performer cash moved
Regulus Res REG.v Jun'20 C$0.64 6-Apr-15 C$0.79 23.4% moved $ TMQ/MIN & Au stocks
Great Panther GPR.to Aug'20 C$0.60 21-Jun-20 C$1.10 83.3% Profit taken, good trade
Jaguar Mining JAG.v Aug'20 C$0.42 21-Jun-20 C$0.65 54.8% Profit taken, good trade
Sandstorm Gold SAND Aug'20 U$7.76 10-May-20 U$9.37 20.7% Profit taken, good trade
Integra Resources ITR.v Aug'20 C$2.23 13-Aug-18 C$5.40 142.2% Profit taken, good trade
Wesdome Gold WDO.to Aug'20 C$2.37 14-Oct-17 C$14.82 525.3% last 1/2 of big win closed
INV Metals INV.to Sep'20 C$0.40 17-May-20 C$0.45 12.5% Cut all Ecuador exposure
Cartier Resources ECR.v Nov'20 C$0.155 3-Aug-18 C$0.25 67.7% Exact close price TBA
Tinka Res TK.v Dec'20 C$0.195 19-Apr-16 C$0.195 0.0% Closed on a round trip fail
2015 to 2019 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
22
Stocks To Follow Closed Positions 2019
Closed in 2019 closed close price
Atico Mining ATY.v jan'19 C$0.55 24-Jul-16 C$0.32 41.8% patience ran out, made room
Candente Copper DNT.to jan'19 C$0.075 3-Ago-18 C$0.05 -33.3% tiny trade, made room for new
B2Gold BTO.to feb'19 C$2.11 12-Set-14 C$4.05 91.9% Took 1/2 profits, reduce size
Western Copper WRN.to mar'19 C$0.80 20-Ene-19 C$0.81 1.3% Spec trade that didn't work
B2Gold BTO.to mar'19 C$2.11 12-Set-14 C$4.15 96.7% Took rest of profit.
GT Gold GTT.v mar'19 C$1.17 10-Oct-18 C$0.90 -23.1% Took loss. Story changed
NovaGold NG apr'19 U$3.84 13-Ene-19 U$4.15 -8.1% Short that didn't work, sm loss
Zinc One Z.v jun'19 C$0.47 14-Set-17 C$0.025 -94.7% clearing out dead trade
Amarillo Gold AGC.v jun'19 C$0.24 22-Ago-18 C$0.20 -16.7% clearing out dead trade
New Gold NGD aug'19 U$1.44 31-Jul-19 U$1.23 14.6% ST short win thru Q2 earnings
IMPACT Silver IPT.v aug'19 C$0.39 21-Jul-19 C$0.46 18.0% took a quick profit
Fiore Gold F.v aug'19 C$0.34 26-May-19 C$0.56 64.7% Took profit, 2q19 avg
Chakana Copper PERU.v oct'19 C$0.84 22-Mar-18 C$0.16 -81.0% Exploreco trade fail. Want space
Wesdome Gold WDO.to oct'19 C$2.37 14-Oct-17 C$7.57 219.4% Sold half, profit taking
Superior Gold SGI.v oct'19 C$1.46 8-Abr-18 C$0.47 -67.8% Failed sm spec on Au. Moved on
Amerigo Res ARG.to nov'19 C$0.91 23-Set-18 C$0.50 -45.1% worst trade of year, hefty loss
Guyana Goldfields GUY.to dec'19 C$0.94 14-Abr-19 C$0.56 -40.4% taking the loss, financials weak
Tethyan Res TETH.v dec'19 C$0.30 8-Set-19 C$0.16 -46.7% tiny trade, word of probs in co
Stocks To Follow Closed Positions 2018
Closed in 2018 closed close price
Amarillo Gold AGC.v jan'18 C$0.38 24-Mar-17 C$0.31 -18.4% Cut away losing trade
Riverside Res RRI.v jan'18 C$0.39 27-Jun-16 C$0.31 -20.5% Cut away losing trade
Eros Res ERC.v jan'18 C$0.175 1-Mar-17 C$0.16 -8.6% CEO sudden exit, not good
Excellon Res EXN.to jan'18 C$1.54 9-Oct-16 C$1.66 7.8% 4q17 poor, one too many bad qtrs
Wesdome Gold WDO.to jan'18 C$1.68 15-Dec-17 C$2.06 22.6% Near-term trade block, took profit
Sabina G&S SBB.to apr'18 C$2.06 17-Dec-17 C$1.77 -14.1% Near-term trade, bad timing, small
B2Gold BTO.to May'18 C$2.11 12-Sep-14 C$3.67 73.9% sold 25% to reduce exposure
Lara Expl. LRA.v May'18 C$0.65 11-Feb-18 C$0.58 -13.8% Spec on Brazil didn't work
Solitario XPL June'18 U$0.72 19-Mar-17 U$0.41 -43.1% Failed trade, may return in 4q18
SolGold plc SOLG.to July'18 C$0.475 19-Nov-17 C$0.415 -12.6% cut, trade didn't perform
Pan American PAAS July'18 U$17.90 1-Jun-18 U$16.30 8.9% modest win on short position
NGEx Res NGQ.to Sep'18 C$1.01 22-Oct-17 C$1.00 -1.0% Closed to reduce Argentina exp
Sandstorm Gold SAND Oct'18 U$3.73 17-Apr-16 U$4.13 10.7% partial sale to raise cash for GTT
Aldebaran Res ALDE.v Nov'18 n/a n/a n/a n/a liquidate spin out of REG
Stocks To Follow Closed Positions 2017
Closed in 2017 closed close price
Continental Gold CNL.to Jan'17 C$2.68 22-May-16 C$4.17 55.6% trade closed, profit taken
Focus Ventures FCV.v Jan'17 C$0.23 1-Jul-12 C$0.05 -78.3% Give up, a disaster trade
Wesdome Gold WDO.to Feb'17 C$1.72 28-Aug-16 C$3.00 74.4% Target hit, sold, good trade
Belo Sun BSX.to Mar'17 C$0.90 30-Jan-17 C$0.90 0.0% failed near-term flip trade
Lara Expl. LRA.v Mar'17 C$1.15 8-Apr-12 C$1.05 -8.7% cut to make room for new trade
Rye Patch Gold RPM.v Apr'17 C$0.31 2-Sep-16 C$0.32 3.2% cut for doubts & new stock
Cordoba Min. CDB.v Jun'17 C$0.75 15-Sep-16 C$0.63 -16.0% closed
Constantine Metal CEM.v Aug'17 C$0.135 9-Apr-17 C$0.28 107.4% spec trade closed, good win
Red Eagle Min. R.to Sep'17 C$0.67 13-Dec-16 C$0.27 -59.7% IKN's biggest failure in years
Starcore Intl SAM.to Sep'17 C$0.61 10-Jan-15 C$0.31 -49.2% Patience ran out
B2Gold BTO.to Dec'17 C$2.11 12-Sep-14 C$3.39 60.7% sold small portion for liquidity
23
Stocks To Follow Closed Positions 2016
Closed in 2016 closed close price
Phoscan Chem FOS.to jan16 C$0.28 29-mar-15 C$0.265 -5.4% Buyout trade, bot but poor deal
True Gold TGM.v jan16 C$0.18 23-ago-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-ene-15 U$1.20 10.1% sold due to lack of value
Lake Shore Gold LSG.to feb-16 C$1.10 07-abr-15 C$1.69 53.6% bot out, sold early in process
Atacama Pacific ATM.v feb-16 C$0.19 26-abr-15 C$0.40 110.5% sold for a double on big pop
New Gold NGD feb-16 U$2.06 24-ene-16 U$2.96 43.7% closed good near-term trade
Sandspring Res SSP.v mar-16 C$0.195 18-oct-15 C$0.32 64.1% Hit tgt, took profit
Teranga Gold TGZ.to mar-16 C$0.54 15-feb-15 C$0.60 11.1% disappointing trade
B2Gold BTG mar-16 U$0.85 13-ene-16 U$1.30 52.9% Separate trade on B2, hit tgt
Dalradian Res DNA.to mar-16 C$0.67 27-oct-13 C$1.00 49.3% Hit target, sold, good win
HudBay Min. HBM may-16 U$4.10 03-abr-16 U$4.36 -6.3% Short trade, poor timing
Nevada Sunrise NEV.v may-16 C$0.185 28-feb-16 C$0.23 24.3% V. small, no big deal either way
Richmont RIC jun-16 U$7.60 01-may-16 U$9.30 22.4% near-term trade, profit taken
INV Metals INV.to jul-16 C$0.25 03-abr-16 C$0.95 280.0% Trade closed on time
HudBay Min. HBM aug16 U$4.98 09-jun-16 U$4.80 3.6% short trade covered, no big deal
Miranda Gold MAD.v oct-16 C$0.125 03-jul-16 C$0.10 -20.0% tiny spec trade, didn't work
Avino G & S ASM nov-16 U$2.00 21-oct-16 U$1.40 -30.0% Abandon trade on bad bot deal
Stocks To Follow Closed Positions 2015
Closed in 2015 closed close price
Argonaut Gold AR.to jan'15 C$1.47 14-dec-14 C$2.53 72.1% Big gain small time, profit taken
Amerigo Res ARG.to jan'15 C$0.405 20-jul-14 C$0.285 -29.6% Given up on weak Cu prices
Reservoir Min. RMC.v jan'15 C$6.05 18-jun-14 C$4.12 -31.9% sold on Cu downturn
Coro Mining COP.to jan'15 C$0.075 26-jan-14 C$0.035 -53.3% sm, sold on Cu downturn
Fortuna Silver FSM mar'15 U$4.12 10-nov-14 U$3.75 9.0% Short used as hedge
GoldQuest Min. GQC.v mar'15 C$0.26 27-oct-13 C$0.085 -67.3% given up ghost
Rio Alto Mining RIO.to apr'15 C$2.30 07-apr-11 C$3.57 55.2% Top pick, bot out, big win
Timmins Gold TGD jun'15 U$0.60 19-apr-15 U$0.62 3.3% near-term trade, out of time
First Majestic AG jul'15 U$10.51 10-aug-14 U$4.55 56.7% horrible failed trade
NovaCopper NCQ.to jul'15 C$1.05 09-apr-14 C$0.50 -52.4% no more Cu exposure, sm sell
McEwen Mining MUX aug'15 U$0.695 21-jul-15 U$0.92 32.4% Closed nearterm flip for win
Midas Gold MAX.to sep'15 C$0.39 21-sep-15 C$0.35 -10.3% Sm. trade idea that didn't work
New Gold NGD oct'15 U$2.18 23-aug-15 U$3.05 39.9% trade closed, profit taken
Legend Gold LGN.v nov'15 C$0.085 01-mar-15 C$0.035 -58.8% tiny "land grab" idea, failed
Timmins Gold TGD nov'15 U$0.245 20-sep-15 U$0.15 -38.8% small near-term loser
Please note that due to space considerations closed positions 2009 to 2014 are now
available on request, or were published in any edition to IKN553 (end 2019).
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The information and opinions contained within this report reflect the personal views of the author and therefore all
material within should not be construed as accurate or reliable or be utilized as advice for investment or business
purposes. Independent due diligence and discussions with ones own investment and business advisor is strongly
recommended. Accordingly, nothing in this report should be construed as offering a guarantee of the accuracy or
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