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Lassonde Curve matters when Building Mines

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Lassonde Curve matters when Building Mines

"When building a mine, a company may trade down to 30-50% of its NAV. 


The Low might come when they finish the feasibility study, and are getting the financing in place,  From the low, they price will rise soon long as they show progress in being on-time and on-budget".  

/  go to xx mins to hear more :   

Pierre Lassonde: 1:1 Dow to Gold Ratio - $25,000 Gold Coming      >


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THE LASSONDE CURVE explains why GCM dropped*

GCM slid back into the "ORPHAN" phase by making a bid for GLDX. 

GCM had a market cap of about $350M (US$6 x61m= $366M) and bid about $250M for GLDX, which needed $378M to build a mine at Toroparu.

It Toro has an NAV of US$1Billion and Old GCM $500M. then the current NAV of new GCM/TPRFF ($4.30 x105M= $450M) is 30% of that

GCM share price at the Moment of Approval of the acquisition of Gold-X / GLDX

GCM / Gran Columbia C$ Quote /  ...  5yr-L: 4yr: 2yr. 10d/ Last: C$5.21


US$ Quote / TPRFF ... update: 10d/ Last: US$4.315, after testing $4.00


Comparison: vs.GDXJ; C$5.21, US$4.315 = 7.89% of GDXJ ($54.71), 2.42% of GLD ($178.38),


RATIO: US$4.315 = 7.89% of GDXJ ($54.71), 2.42% of GLD ($178.38),



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Orphan period is when the Uncertainties are Highest

BUY when the uncertainities start to go away... with the Production decision


Using this, you can see that it’s good to get into projects early, then sell at a peak – then when it is decided they will construct a mine, to get back in then. The further to the right on this sheet, the less risk. The less risk, also means less upside.

Now, there are other things to consider in what miners to buy….

  1. Who are the jockeys? Have the people running this had great success? Have they done this before? Are they well respected?
  2. What are the horses? Are they decent projects with volume? Are they cost effective to mine? Is there infrastructure in place, or would a billion dollars need to go into infrastructure to buy? Is it close to another mine where you could truck pay to it?
  3. What is the jurisdiction? I tend not to put my money in certain jurisdictions. You are mostly safe in Canada, the US, and Australia. But every jurisdiction has its pitfalls. Political unrest. Government seizing a mine. The US and environmental permitting issues. Governments shaking down companies for taxes. Each jurisdiction at the country level has its own pitfalls, then you have to go deeper in to that. For example, Nevada in the US is a great mining jurisdiction, but Alaska just shut down a potential trillion dollar mine before it was ever built due to environmental concerns.
  4. Share structure and funding. Who are the big backers? Does management have skin in the game? Is share dilution a big issue? For example, if you need to raise $10 million for drilling, how are you paying for it? Issuing more common shares and private placements to dilute me? Share dilution is almost inevitable in some instances. In others, maybe a company takes on debt, exchanges shares for land, sells projects to raise money, or gives streaming deals on future gold/silver to fund projects.

> https://renaissancemen.org/2021/01/19/how-to-invest-in-mining-stocks-the-asymmetric-play-of-a-silver-miner/


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