Monthly Investor Report - April 2024

Golden Prospect Precious Metals Ltd

24 May 2024

 

 

Golden Prospect Precious Metals Limited

Monthly Investor Report - April 2024

The full monthly factsheet is now available on the Company's website and a summary can be found below. 

NCIM - Golden Prospect Precious Metals Ltd - Fund Page

Enquiries: 

For the Investment Manager 

CQS (UK) LLP 

Craig Cleland 

0207 201 5368 

For the Company Secretary and Administrator 

Apex Administration (Guernsey) Limited

James Taylor

0203 530 3600

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Fund Description 

The objective of the Golden Prospect Precious Metals Fund is to provide investors with capital growth from a group of companies in the precious metals sector.

Portfolio Managers 

Keith Watson and Robert Crayfourd.

Key Advantages for the Investor 

·      Access to under-researched mid and smaller companies in the precious metals sector

·      Potential inflation protection from precious metals assets

·      Low correlation to major asset classes 

Key Fund Facts¹ 

Total Gross Assets:	£39.93m
Reference Currency:	GBP
Ordinary Shares:	85,503,021
Net Asset Value:	41.65p
Mid-Market Price:	32.30p
Net gearing:	9.4%
Discount:	(22.45%)

Ordinary Share and NAV Performance² 

	One Month	Three Months	One Year	Three Years	Five Years
	(%)	(%)	(%)	(%)	(%)
NAV	15.44	23.37	6.88	(29.00)	57.82
Share Price	4.19	19.63	(5.97)	(41.70)	61.10

Commentary³ 

Precious metals were stronger again in April with gold and silver up 6.2% and 11.3% respectively.

The Fund's NAV gained 15.4% but the share price lagged, gaining 4.2% as the discount widened. This compared to the Arca Gold BUGS index, which gained 5.5% in sterling terms. Gold hit a new all-time high of $2,431/oz around mid-month. Whilst silver is now displaying its historic higher beta correlation to gold, it still remains short of its $49.51 all-time high reached in 2011.

The Chinese gold price has sustained a steady $20-$40/oz premium over western pricing so continues to drive flows from the West to East. Western ETF's remained sellers of physical gold, dropping 11.3Moz, whilst Chinese demand remains strong, although it does look increasingly aided by retail demand. This appears to be supported by concerns of a Renminbi devaluation and an apparent lack of other investment options due to the regional property crisis; Chinese investors are looking to diversify with property having previously been a mainstay for domestic investment given tight capital controls.

Over the month the Fund added to existing holding Reunion following a bid from G-Mining. We believe the combination of Reunion's development asset in Guyana with one of the world's best gold mine building team in G-Mining, having built multiple mines across the region, could lead to further valuation appreciation.

The Fund also added Equinox Gold on discounted placing, anticipating a re-rating as their Greenstone asset moves into production, lowering their overall production cost per ounce.

Performance contributions on the month came from across the Fund, including Emerald Resources, Fortuna Silver and Ora Banda. Emerald Resources has now seen its acquisition of the Australian Bullseye asset go unconditional as they exceeded 90% ownership. Fortuna Silver benefitted from stronger silver pricing and Ora Banda's operational turnaround continues to progress.

In addition, the Fund reduced its position in Ecuadorian Gold/Copper project Adventus Mining after a bid by Silvercorp.

	Gross Leverage5 (%)	Commitment Leverage6 (%)
Golden Prospect Precious Metals Limited	109	109

CQS (UK) LLP

4th Floor, One Strand, London WC2N 5HR, United Kingdom

T: [phone] | F: [phone]

CQS (US), LLC

152 West 57th Street, 40th Floor, New York, NY 10019, US

T: [phone] | F: [phone]

Tavistock Communications

18 St. Swithin's Lane, London EC4N 8AD

T: [phone] | [e-mail]

Sources: ^1,2 CQS as at the last business day of the month indicated at the top of this report. Performance is net of fees and expenses. New City Investment Managers took over the investment management function on 15 September 2008. These include historic returns and past performance is not a reliable indicator of future results. The value of investments can go down as well as up. Please read the Important Information section at the end of this document. ³ All market data is sourced from Bloomberg unless otherwise stated. The Fund may since have exited some / all the positions detailed in the commentary. ⁵ For methodology details see Article 4(3) of Directive 2011/61/EU (AIFMD) and Articles 6, 7, 9 and 10 of Delegated Regulation 231/2013. ⁶ For methodology details see Article 4(3) of Directive 2011/61/EU (AIFMD) and Articles 6, 8, 9, 10 and 11 of Delegated Regulation 231/2013.

 

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