The Junior Gold fund, which has been investing in smaller precious metals mining companies since 2009, is set to change its name to the IFSL SIM Junior Gold and Silver Miners fund, effective November 26, 2021.
The change reflects the intra group transfer of the authorised corporate director (ACD) from Marlborough to IFSL, as well as the more diversified investments held in the fund, and the increasing investment opportunities in silver mining companies in addition to gold miners.
Over the past 18 months, the portfolio’s weighting in silver mining companies has increased to 40% of the fund’s value.
The fund’s appointed investment management company, Sector Investment Managers (SIM), attributed the increased allocation to growing industrial demand for the metal, which is underpinned by the global shift towards renewable energy, electrification of transportation and other technological developments that favour silver’s electric conductivity.
Angelos Damaskos, CEO of Sector Investment Managers, said: “To maximise the potential of investing in precious metals miners we recognised the need to broaden the scope of our investments. While gold mining shares remain the biggest proportion of our overall portfolio, we have steadily been adding holdings in silver miners.
“The current macro-economic situation, with rising inflation and historically low interest rates, is likely to result in an investor move to safe-haven assets such as gold and silver bullion. This will strengthen the appeal of all aspects of the gold and silver mining-to-market process.”
“We invest in smaller, earlier stage operations, where we see most potential for growth, and these tend to perform better in a rising precious metals price environment, which boosts profitability,” said Damaskos.
SIM believes that gold and silver mining companies are “undervalued” compared to the commodity they produce and the strong cash flows generated by operating mines.
Bullion profit margins have remained healthy despite some cost inflation in operations, equipment, energy and other key price rises.
The Junior Gold fund primarily invests in companies with the strongest growth potential, while seeking to avoid politically unstable territories and very early-stage exploration risks.
Sector Investment Managers is a natural resource specialised investment management company which offers investors allocation tools with exposure to the super-cycle driving industrial commodities.
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