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Why not bet on royalty companies



An excellent idea is to enhance the portfolio with an investment in a royalty company

Royalty companies pay money to mining companies in return for a share of current or future production, usually gold or silver shipments. And there are royalties, company shares or so-called milestone payments. Royalties usually account for one to three percent. They can take different forms but are usually defined as a small percentage of the net smelter return (NSR). This in turn is calculated as the proceeds of precious metal production, with refining and transportation costs deducted.

The mine operator can bring his mine to production more quickly and the royalty company participates in the mining company without its own mining risk. In addition, shares in companies that are not yet producing are favorable for the royalty company. If the precious metals are then produced, the royalty company can often score with a special profit lever. This is even more true when gold and silver prices rise. So, both partners benefit, because financing is not always easy to obtain. Another advantage of royalty companies is the large number of partner companies, i.e., a broad diversification. For the investor, this means diversification that a single mining company cannot offer in this way. Among the well positioned and successful royalty companies are Gold Royalty and Osisko Gold Royalties.

With a focus on North America, Osisko Gold Royalties (https://www.commodity-tv.com/ondemand/companies/profil/osisko-gold-royalties-ltd/) owns over 180 royalties and streams. Among them is the valuable five percent net smelter return royalty with respect to the largest gold mine (Malartic Mine) in Canada.

Gold Royalty (https://www.commodity-tv.com/ondemand/companies/profil/gold-royalty-corp/) has more than 200 royalties in its portfolio and is focused on North, Central and South America. Current corporate information and press releases from Gold Royalty (https://www.resource-capital.ch/en/companies/gold-royalty-corp/) and Osisko Gold Royalties (https://www.resource-capital.ch/en/companies/osisko-gold-royalties-ltd/)

In accordance with §34 of the German Securities Trading Act (WpHG), I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and that there is therefore a possible conflict of interest. No guarantee for the translation into German. Only the English version of this news is valid.

Disclaimer: The information provided does not constitute any form of recommendation or advice. Express reference is made to the risks involved in securities trading. No liability can be accepted for any damages arising from the use of this blog. I would like to point out that shares and especially warrant investments are fundamentally associated with risk. The total loss of the invested capital cannot be excluded. All information and sources are carefully researched. However, no guarantee is given for the correctness of all contents. Despite the greatest care, I expressly reserve the right to make a mistake, especially with regard to figures and prices. The information contained is taken from sources that are considered reliable, but in no way claim to be correct or complete. Due to judicial decisions the contents of linked external pages are to be answered for (so among other things regional court Hamburg, in the judgement of 12.05.1998 – 312 O 85/98), as long as no explicit dissociation from these takes place. Despite careful control of the contents, I do not assume any liability for the contents of linked external pages. The respective operators are exclusively responsible for their content. The disclaimer of Swiss Resource Capital AG applies additionally: https://www.resource-capital.ch/de/disclaimer-agb/.

Posted by on 14. August 2023. Filed under Internet, Picture Gallery. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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