GoldMinerPulse: TSX/TSXv Gold Mining and Silver Mining Companies

Last Updated With Closing Market Prices and Document Filings from: 31 October 2014 (as available at TSX closing time).


Seabridge Gold    

Correlations - New Feature!!

Click here to chart the correlation of a TSX/TSXv gold/silver equity with the price of gold over the past year. Or check out the correlation with the price of silver here.

Feedback from one of the 1st users:

To quote the cop in Superbad, that metric is ''superbadass!''. And fun.

Since we come to the junior producer field looking for correlation, this is definately right up a stock pickers alley. Definately a home run. ...

Very nice.

Returns From Gold Equity ETFs vs Gold/Silver Bullion vs Stock Picking The TSX Producers

The average returns from investments in one of three gold equity ETFs versus returns from purchases of gold or silver bullion versus the return from stock picking strategies are compared below:

Average Returns: 31 October 2014
• average return assumes buy and hold on
1, 3, 7, 11, 17, 23, 31 & 41 prior TSX trading days.
group average % return
Oracle: Best 20 -3.7
Physical: Gold -4.6
Physical: Silver -8.0
Stock Picks: MVG -17.5
ETF: GDX -19.1
ETF: ZJG -21.1
Stock Picks: S1 -22.4
Stock Picks: S3 -24.7
ETF: GDXJ -25.1
Stock Picks: S2 -26.0
Oracle: Worst 20 -33.8

Stock Picks: MVG (Max Value Group), Stock Picks: S1, Stock Picks: S2 and Stock Picks: S3 are rule based selection strategies for picking TSX/TSXv gold/silver producers. The design objective for each of the Stock Picks groups is to generate better returns than the gold equity ETFs when the price of gold is rising while providing returns roughly on par with (or only slightly worst) in a flat or falling gold market.

The MVG membership list, and related rankings of the TSX/TSXv gold and silver producers used to compute the MVG, can be computed using the algorithm described within or alternatively the MGV list and related rankings can also be purchased pre-computed from GoldMinerPulse on a daily, monthly or quarterly basis (see Contact to learn more).

The Stock Picks: S1, Stock Picks: S2 and Stock Picks: S3 Stock Picks are alternate stock picking strategies under current investigation - the S1, S2 and S3 strategies can be easily implemented for independent back testing. Complete details, including access to more back testing results, are available on a subscription basis.

The Oracle: Best 20 is an upper bound on the possible returns from a stock picking strategy, but since the Oracle stock picking strategies relies on a look ahead cheat (i.e. seeing the closing prices on the 2014-10-31 when making the original buy decisions), it is not implementable. The Oracle: Best 20 does however provide an upper bound benchmark against which to test stock picking strategies -- the gap between the MVG and ETF returns versus the Oracle: Best 20 suggests a better stock picking strategy potentially remains to be discovered.

The data points used to compute average return were:  

Percentage return for each investment choice assuming:
• buy at the close on the buy dates listed below
• sell at the close on 31 October 2014.
group / buy date 3 Sep.17 Sep.29 Sep.7 Oct.16 Oct.22 Oct.28 Oct.30 Oct.
 
Oracle: Best 20 -15.5 -11.2 -4.5 -1.0 1.6 -1.8 -2.5 5.3
Physical: Gold -7.8 -4.2 -3.6 -3.2 -5.5 -5.6 -4.6 -2.2
Physical: Silver -15.9 -12.7 -7.7 -6.2 -7.2 -5.9 -6.2 -2.1
Stock Picks: MVG -33.0 -26.5 -21.6 -12.9 -14.6 -14.0 -13.9 -3.7
ETF: GDX -33.2 -26.5 -20.9 -15.7 -19.4 -15.8 -16.2 -5.4
ETF: ZJG -35.8 -28.4 -24.1 -16.1 -23.8 -18.4 -17.3 -5.1
Stock Picks: S1 -38.2 -30.5 -24.7 -18.3 -23.8 -18.8 -18.5 -6.1
Stock Picks: S3 -40.8 -32.5 -28.7 -20.6 -27.0 -21.6 -20.3 -6.3
ETF: GDXJ -39.4 -34.9 -29.4 -22.2 -26.5 -21.3 -20.6 -6.5
Stock Picks: S2 -40.4 -35.7 -30.0 -22.6 -27.9 -23.2 -21.0 -6.9
Oracle: Worst 20 -53.0 -44.9 -41.0 -33.9 -34.0 -28.1 -24.5 -11.0

The percentage returns, which assume a purchase at the close of each buy date and a sale at the close of the 2014-10-31, are highligthed as follows:

Group with the best return for the buy date.
Group with the 2nd best return for the buy date.

The table rows are sorted by the arithmetic average of the percentage returns realized for each of the buy dates. The table rows are ordered from highest average percentage return to the lowest.

The percentage return tables are updated after the close of each TSX trading day. Group member is always computed prior to the start of each trading day. On a day to day basis, changes in the Oracle groups are common. Membership in any of the Stock Picks groups may also vary over time but by design the MVG group changes typically occur on a time frame matching the flow of new financial and technical reports from the producers (typically quarterly). The other Stock Picks group members are expected to vary even less frequently.

Stock Picks: MVG, an equally weighted grouping of TSX/TSX producers, is constructed using rule-based stock picking strategy. For more details please see:

  • Rankings for a description cost and benefit metrics we use to rank TSX/TSXv gold and silver producers.

  • Max Value Group of TSX/TSXv Gold and Silver Producers Criteria for the rules used to construct the Max Value Group before trading begins on each buy date.

  • Profiles for the 2014-10-31 version of the cost and benefit metric rankings of various equally weighted groups of TSX/TSXv gold and silver producers, including the Max Value Group.

The Stock Picks: S1, Stock Picks: S2 and Stock Picks: S3 Stock Picks are alternate stock picking strategies under current investigation. Complete details, including access to more back testing results and alternate selection strategies, are available on a subscription basis.

The Oracle groups, created by using a look ahead cheat designed to select the best (or worst) possible returns from buying and holding an equally weighted group of TSX/TSXv gold/silver producers, are excluded from highlighting.

The ETF groups assume you buy and hold the actual ETF. The Physical groups assume you are buying/selling gold (or silver) bullion at the spot market price at the TSX market closeing time.

Conclusions

In a rising gold market, the gold equity ETFs provide a significantly better return than the returns on physical gold or silver. However, the best returns can be expected from the application of stock picking strategies. This page now provides live testing of 4 alternate stock picking strategies (Stock Picks: MVG, Stock Picks: S1, Stock Picks: S2 and Stock Picks: S3). Currently, the Stock Pick strategies are limited to TSX/TSXv producers. Access to full details on back testing results from various stock picking strategies is available to monthly / quarterly subscribers (customized per subscriber).

Although no buy and hold stock picking strategy can better or even equal the outstanding returns for the Oracle: Best 20, the Oracle: Best 20 does provide a hard upper bound against which to benchmark returns from an implementable stock picking strategy.

In a flat gold market, the performance difference between the stock picking strategies (the Stock Picks: groups) and gold equity ETFs is expected to narrow.

In a falling gold market, holding physical gold/silver is expected to loose the least of the various groups presented while the ETFs and stock picking strategies can be expected to yield the poorest returns.

Since holding gold/silver bullion investments in a falling market are, by definition, going to loose money, an overall gold/silver investment strategy to maximizing returns overall markets to consider is:

  • increasing investment weighting in Stock Picks as the price of gold rises,

  • move investments from Stock Picks to physical gold/silver as the price of gold becomes range bound, and

  • move into and stay in cash as the price of gold is falling.

GoldMinerPulse does NOT offer any investment advise. Rather, all discussions here of investment strategies are made to introduce GoldMinerPulse services - GoldMinerPulse provides actionable data to investment professionals to support their investment and trading strategies (see Contact for more details). The Stock Picks: MVG, S1, S2 and S3 are concrete example of the kinds of actionable information that can be built from value based metrics available from GoldMinerPulse.

 

Gold and Silver Production Statistics

Production Based on Last/Latest Four Quarters

Using the most recently available quarterly production reports, the gold and silver stocks listed on the TSX/TSXv are reporting production totals on a rolling 4 quarters of:

  • Gold: 29.38M ounces (1,007.31 tons or 913.82 tonnes), a 0.4% change over the 4 quarters ending at the prior quarter.

  • Silver: 168.02M ounces (5,760.69 tons or 5,226.01 tonnes), a 4.8% change over the previous 4 quarters ending at the prior quarter.

The running totals for quarterly production numbers for companies with a quarter ending in the months of July, August and September 2014, along with the changes on a Quarter on Quarter (QoQ) basis, for TSX/TSXv Gold and Silver producers are:

# Producers
Reporting
Gold Produced
Latest Q Report
QoQ
Gold Δ
Silver Produced
Latest Q Report
QoQ
Silver Δ
56 of 87 4,446,721 oz
 
152.5 tons
 
138.3 tonne
7% 23,985,722 oz
 
822 tons
 
746 tonne
-2%

TSX/TSXv Gold Reserves and Resources

Gold reserves and resources for TSX/TSXv listed companies with at least 12.5% of their in situ metal values from gold:

Metric

 
Type of Equity

Gold Reserves
(tons)

 

Gold Resources
(tons, inclusive of reserves)

 

Gold Producers

18036 41429

Gold Developers

3913 14140

Gold Explorers
>5M Oz AuEq

2025 8087

Gold Explorers
<5M Oz AuEq

127 6057

All Gold Equities

24101 69713

Based on gold production rates reports over the last 4Q, TSX/TSXv gold producers have 21.5 years of gold reserves.

TSX/TSXv Silver Reserves and Resources

Silver reserves and resources for TSX/TSXv listed companies with at least 12.5% of their in situ metal values from silver:

Metric

 
Type of Equity

Silver Reserves
(tons)

 

Silver Resources
(tons, inclusive of reserves)

 

Silver Producers

166806 386174

Silver Developers

49925 130544

Silver Explorers
>5M Oz AuEq

6562 60803

Silver Explorers
<5M Oz AuEq

174 44905

All Silver Equities

223466 622426

Based on silver production rates reports over the last 4Q, TSX/TSXv silver producers have 33.6 years of reserves.

TSX/TSXv Gold and Silver Equities Statistics

The following table includes TSX/TSXv listed companies with at least 12.5 of their in situ metal values from gold or silver (in US$).

Type of Equity

 
Metric

Producers
 

 

Developers
 

 

Explorers
>5M Oz AuEq

 

Explorers
<5M Oz AuEq

 

Enterprise Value
Per Oz AuEq

$65 $7 $2 $8

Estimated Discovery Cost
Per Oz AuEq

  $11 $3 $20

Net Working Capital
(US$)

$20,164M $1,121M $542M $625M

TSX/TSXv Company Counts by Category

TSX/TSXv company may appear at most one time in the following table. Companies without a gold/silver resource (generators, historic and grass roots) are included on the basis of qualitative assessment of descriptions published in quarterly financial statements.

Category # of Companies in Category

Gold/Silver Streaming and Royalty Companies

8

Gold/Silver Producers

87

Gold/Silver Developers

117

Gold/Silver Explorers

228

Gold/Silver Generator Model Companies
(No Gold or Silver Resource)

28

Gold/Silver Explorers with Historic Resource
(No Gold or Silver Resource)

26

Gold/Silver Grass Roots Explorers
(No Gold or Silver Resource)

522

Total Companies Listed in Sedar.com
(Current, historic, TSX/TSXv, CNDX, and others. See Note 1)

~30,000

Note 1: All TSX/TSXv listed companies are required to file in Sedar.com. However, Sedar.com companies include current companies, companies that no longer file (i.e. as a result of take over, merger, re-organization, bankruptcy, etc.), CNDX companies (Canadian over the counter market listings), and companies listed on foreign exchanges (e.g. US OTC, London, etc.) that have some connection with Canadian investors.

Gold ETF News

  • 30 October - Market Vectors Gold Junior Miners (GDXJ) decreased holdings in TSX miners by $3.1M. GDX remained unchanged.

  • 29 October - GDX and GDXJ holdings remained unchanged.

  • 28 October - Market Vectors Gold Junior Miners (GDXJ) decreased holdings in TSX miners by $3.7M. GDX remained unchanged.

  • 23 October - Market Vectors Gold Miners (GDX) increased holdings in TSX miners by $12.7M. GDXJ remained unchanged.

  • 22 October - Market Vectors Gold Miners (GDX) increased holdings in TSX miners by $25.3M. GDXJ remained unchanged.

  • 17 October - Market Vectors Gold Miners (GDX) increased holdings in TSX miners by $26.3M.

  • Note: On 22 September Market Vectors Junior Gold Miners ETF (GDXJ) added a Market Vectors Gold Miners (GDX) holding as its 4th largest position.

  • Seabridge Gold (SEA CN, SA), a dynamic, well-funded company active in Northern British Columbia, is the only gold explorer/developer included in both the Market Vectors Gold Miners ETF (GDXJ) and the newly-launched Sprott Gold Miners ETF (SGDM). Visit Seabridge Gold Inc. Project Summary for the latest company headlines and resource metrics.

LBMA GOFO Rate and Shanghai Gold Exchange Interplay

On 27 October the 1 mth GOFO dropped to -0.0950 down from 0.0200 on the Friday close. The 1 mth rate stayed negative through 30 October. The 1 mth GOFO rate on 30 October was at -0.0475 up from -0.0775 on 29 October signalling that the supply of gold for delivery continues to improve. The improvement trend continued on 31 October with the 1 mth GOFO rate rising to -0.0250. See News for more details on GOFO negative rates.

A negative GOFO rate is an indicator of supply shortages in meeting physical gold delivery in London, which is believed to be largely moving to Eastern markets via Swiss refiners. The Shanghai weekly gold delivery from vault (Oct17/14, latest available data point), showed 2014 YTD deliveries, while improving over last month, continue to lag 2013 YTD deliveries by -11.6% (see SGE Gold Delivery From Vaults).

Shanghai Gold Exchange Ag(T+D) Daily Delivery (Settlement) Volumes

The silver AG(T+D) daily delivery volume has reported 6000, 8160, 8190, 15120, 6000 and 2040 kilograms in the last 6 trading days after being at virtually zero daily since late July (see Shanghai Gold Exchange, Daily Quotes).

Shanghai Gold Exchange Gold Closing Price Versus Kitco Closing Price

The Shanghai Gold Exchange Yuan Renminbi price of gold and premium/discount in US dollars relative to the Kitco spot price at TSX close follows (yearly average and 1 year rolling time period comparisons):

Yearly Average Shanghai Gold Exchange Premium:

  • 2014 (YTD average): $3.42

  • 2013 (Full year average): $16.05

Rolling Week on Week Comparisons of Shanghai Gold Exchange (SGE) Premiums (Δ) vs Kitco Spot Gold Price:

Date Shanghai Gold Exchange Close - Au(T+D) Kitco Spot Price at TSX Close SGE Δ
Yuan Renminbi/gram US$/oz
31 October 2014 230.20 $1171 $1171 $0
30 October 2014 237.39 $1207 $1198 $9
29 October 2014 241.87 $1231 $1211 $20
28 October 2014 241.70 $1230 $1228 $2
27 October 2014 242.10 $1231 $1228 $3
24 October 2014 242.55 $1234 $1231 $3
...
2 May 2014 Closed $1299 na
1 May 2014 Closed $1299 na
30 April 2014 260.24 $1293 $1291 $2
29 April 2014 260.00 $1293 $1297 $2
28 April 2014 259.63 $1303 $1293 $6
25 April 2014 259.63 $1291 $1303 -$11
...
1 November 2013 260.60 $1329 $1315 $13
31 October 2013 262.01 $1337 $1324 $13
30 October 2013 263.87 $1347 $1342 $5
29 October 2013 264.27 $1349 $1345 $4
28 October 2013 264.10 $1350 $1353 -$3
25 October 2013 262.82 $1343 $1353 -$9

Currency conversions made using spot rates available on the date. The SGE Δ is computed as the SGE closing price in US$ minus Kitco Spot Price (bid) at TSX Close.

See the SGE page for daily updates on the Shanghai Gold Exchange, including a comparison of SGE gold delivery from vault in 2014 versus 2014.

Also see China Looking To Dominate Gold Market With International Shanghai Gold Exchange, a 27 June 2014 Kitco News story.

Friday's News Highlights

Select Friday's news headlines from the 1,349 mining stocks (producers, developers, explorers, base metal producers plus a few of the capital pool companies) GoldMinerPulse tracks:

  • Newmont Mining Corporation (NEM) | Visit
    • 06:04pm EDT Final Glance: Gold companies [AP more]
    • 05:26pm EDT Today's Market Thorns, Roses, All Time Highs, and ETF All Time Highs [Yahoo Finance Blogs more]
    • 04:24pm EDT The rally that keeps on giving! [Yahoo Finance Blogs more]
  • Roxgold Inc. (ROG.V) | Visit
    • 07:30am EDT Roxgold comments on events in Burkina Faso [CNW Group more]

View more of Friday's news headlines here. Our news headlines update each TSX/TSXv trading day, typically mid morning and then several times during the trading day.

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