Building a Gold Stocks Portfolio

Discussion in 'Stocks & Derivatives' started by mmm....shiney!, May 31, 2021.

  1. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    I'm no expert, but will give it a go from my knowledge.
    Cut-off grades vary depending on geology, depth, overburden etc.
    I looked at the MTC results for hole 16, and the lowest cut-offs are quoted as "optimal open pit cut-offs", so are the cut-offs for best-case open pit mining.
    You will notice the cut-offs for each interval gets higher as the interval gets deeper - more over-burden removal means mining is more costly.
    The deepest section of this hole (>100m) has quoted cut-off of 1g/t, which I assume is because it will require more costly underground mining to retrieve.


    @PMCollector is right.... the results are smeared. If the numbers are broken down the results become a little less outstanding than the announcement would like you to believe.
    Here is my interpretation:

    Taking hole 16 as the example, the total hole depth is 127m @ 5.31 g/t (average). That is equal to 674 gram meters (127 x 5.31) for the entire hole.

    The 1m intersection at 584 g/t = 584 gram meters. Thus, 87% of the gold strike lies in a single meter of intersection, which is located 40m below surface.
    Similarly, the 2m intersection at 13.94 g/t = 27.9 gram meters constitutes 4% of the strike, but lies at 106 meters deep.

    So, this means 91% of the gold lies within 2 very thin intersections located at 40m and 106m.

    The remaining 9% of the gold lies in the remaining 124m band. This remaining band holds the left over 62 gram meters (674 - 584 - 28 = 62). If you average out the grade of this remainder (62/124 = 0.5 g/t).
    You will notice that this grade of 0.5g/t is exactly what MTC quoted as optimal open pit cut-off grade (coincidence?). You have to ask how economically the deepest sections of this band can be mined (if at all)?.

    But there are 3 more kickers (red flags?):

    1. This announcement is nothing but a reiteration of past results.... a fluff announcement using sensational headlines (usually a warning sign to me).
    2. Hole 16 is the best result of all the holes, so are the remaining holes indicating an economically sub-par ore structure on average?
    3. This caveat:
    mtc.jpg
    This tells me that not only is the average of the grade lesser quality than hole 16, but all are again diluted by the drilling angle which has magnified (to an unknown extent) all the gram meter results for every hole. Double whammy.

    Not vey exciting results to me.
     
    Last edited: Jun 4, 2021
  2. PMCollector

    PMCollector Well-Known Member

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    ^ great analysis and agree that results not very exciting..It's also reflected in the chart; news out on the 1st with catchy headline, gapped up, strong price rejection on massive volume - so, basically we can assume old holders selling the news and huge amount of news holders now becoming trapped volume, whoever has money in this may have to wait a long time for this to digest unless a follow up announcement comes that changes the action.
    Screen Shot 2021-06-04 at 9.31.27 pm.png
     
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  3. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    The "SS Brains Trust" of @wrcmad and @PMCollector confirmed my suspicions of MTC so it's gooooone! I ran some numbers on AWJ and it's really speccie, needs a lot more drill holes and a lot more real estate to even look like being economic, remains in the list at the moment because of the team behind it and it's plans to buy more ground.

    When I get time I'll try and run the ruler over NME and KAI as well, unless someone else wants to chime in.

    The above are price ranges I'd be looking to see some indication of a reversal.
     
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  4. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    I like WAF. Good to see in your No.1 as well. I have a substantial holding from 40c and am hoping to exit around $1.50 for a near-4-bagger.
    PRU is another of my main goldie-holdings. I like the growth story.
    EVN and GOR need caution IMHO..... I don't hold.
    Between the lines ...... Mike is legendary and has made me a bundle over the last 18 months, including the CDV T/O. For 6 bucks a month, my return has been better than any crypto you could dream of. :p
     
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  5. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    They weren't my recommendations remember, just copied from a Stockhead article. I did chuck in EMR though. :)
     
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  6. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    I'll be keeping an eye on the 77c - 82c range for Emerald Resources (ASX:EMR), and West African Resources (ASX:WAF) 77c - 82.5c
     
  7. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    [​IMG]

    Moving toward the buy range I identified last month. Today's candlestick with the wick above and below can mean a pause or a change in the price trend.

    In other news Chalice is spinning off their gold interests later in the year as a new company hoping to target Tier 1 reserves, and there was another mob too that I own that was spinning off its gold assets too and offering shares in the new company to current shareholders but for the life of me I can't remember who.
     
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  8. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Today's candlestick for EMR is pretty much the same as yesterday's, just green. So no idea what's going to happen ie pause or change in trend.
     
  9. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    It wasn't a gold spin off, it was Neometals demerging their nickel assets. Free shares. Gotta love that. :D
     
  10. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    I have held a tidy parcel of PDI for a while. The recent drilling results seem to be the last piece of the puzzle that joins the pieces together to make this find a very mineable ore body. The results suggest this will be bigger than WAF.
    I bought even more after the announcement, as I reckon this will be a mine, or another T/O target like CDV.
    Just sayin.
     
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  11. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    There she blows. Not a bad week for PDI.

    PDI.jpg
     
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  12. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    I was looking at metals etfs tonight but everything looks so crappy.
    I dont know if we all look at the same stocks but looks like a sinking ship on my end.
    I saw a few other things not related to those that might be promising but not much really.
     
  13. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    If you have Patreon, "Between the Lines Finance" is just about one of the best commentators on the gold market. His focus is mainly mid to large cap, value stocks. The GDX is a good ETF that tends to move more quickly than the POG. And just at a quick glance the chart is looking pretty healthy IMO. If you're chasing a bit more sting you could look at the GDXJ which includes minnows in it.
     
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  14. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    100% back this up.
    This guy has made me a small fortune over the last couple of years.
     
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  15. 66rounds

    66rounds Well-Known Member Silver Stacker

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    Is it too late to join the party for a small fish like me?
     
  16. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    How far do you think the gold price will run up? If you're bearish then it's probably too late. If you're bullish then it's probably not. Last I looked BTLF on Patreon was about USD6/month.
     
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  17. 66rounds

    66rounds Well-Known Member Silver Stacker

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    What does it mean when a dividend is franked greater than 100%?
     
  18. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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  19. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Revisiting a few of the first lost of stocks discussed:

    1. WEST AFRICAN RESOURCES (ASX:WAF) 31/05/21 $1.06 now $1.37 - solid company
    2. AURIC MINING (ASX:AWJ) 31/05/21 0.16 now 0.135, looks like the hype has worn off, chart looks horrible
    3. METALSTECH (ASX:MTC) 12.5c - 15c.* 31/05/21 was 0.15 now 0.435, this thing pumped last month getting up to 0.80c!!! Good thing I put a line through it otherwise I may have had a tax problem. :oops:
    4. EVOLUTION MINING (ASX:EVN) 31/05/2131/05/21 was $5.21 now $3.72
    5. GOLD ROAD RESOURCES (ASX:GOR) 31/05/21 $1.56 now $1.335
    6. NEX METALS (ASX:NME) 3.3c - 4.1c 31/05/21 0.032 now 0.035
    7. KAIROS MINERALS (ASX:KAI) 3.2c - 4.0c
    [/QUOTE] 31/05/21 0.033 now 0.030

    And what @wrcmad said:

    And what @PMCollector said about MTC:

    he was right, it certainly did rip.

    I don't hold any of these stocks.
     
  20. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    @66rounds, I've done some hunting around and can't find anything helpful to answer your question. I've seen mention of it eg like in questions on Reddit posts etc but no answers. Where did you come across it?
     
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