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A U G U S T / S E P T E M B E R 2 0 1 9 www.resourceworld.com 21 T o say the precious metal market today is hot is an understatement. Since the beginning of the year palladium is up 25%, gold up 11.5%, platinum is up 9.20%, and even underper - forming silver is up 6%. The big industrial metals are also moving higher with nickel trading at 52-week highs up 30% and cop- per up 10%. Even more impressive is the S&P/TSX Global Gold Index up 27.5% since the start of the year and up 36.50% since the May lows. Threatening trade war talks are also causing excitement in the rare earths, as China is the dominant supplier of these critical metals. While these numbers are showing signs of life, the move from the May lows is even more dramatic. The adage "Sell in May and Go Away" and the predicted "Summer Doldrums" were not a well-timed investment strategy this year, especially when we are going into the traditionally strong seasonal strength in August that historically lasts well into the fall and winter. As the summer heats up, I am reminded that football season is upon us. Coaches are yelling from the sidelines, reminding players that football is about the basics: blocking, tackling and hitting. When we invest in mining companies, we can remind ourselves of the basics in our investment process. They are what many in the industry refer to as the 3 M's: 1) Management or the people involved 2) The mineral project itself and its location and 3) Money or the ability to raise it in a timely manner. When it comes to evaluating a junior mining company, it is commonly believed that management is the most important factor. Visiting and talking to many mining management teams allow investors to get a sense of the management's professionalism, experience, perseverance and conviction on the property they are advancing. The location of the mineral property is becoming increasingly more important. With past expropriations in Indonesia, Venezuela, Bolivia, and Ecuador, jurisdic - tion is a consideration. This even includes Canada with occasional Indigenous objec- tions. Where the major mining companies will invest their company's money, time, and expertise in taking a project into production that could well last 30 years and sometimes more, is of critical impor - tance. Of course, our favorite locations are projects next to or near producing or a past producing mine, as a further way to reduce risk. In the past few years, raising money has been a challenge for all but the very best mining teams and projects. As an industry, we have witnessed a failure of the tradi - tional risk capital staying with the sector with value investors and knowledgeable financiers filling the void. These new groups include royalty/ streaming companies, private equity, and even strategic well-heeled individuals. Relying on these investors comes with a cost. While this change should be wel - comed as it improves the efficiency of finding the best projects to advance, this At the Market by John Newell AT THE MARKET continued on page 68 Finding conviction in today's mining market