Thumbs up for licensing and streaming companies
Among the market analysts who share this opinion is Frank Holmes of US Global Investors. The Canadian company Franco-Nevada was one of the first in the licensing business and has perfected the model. Today, there are several companies that specialize in it.
The big plus is that the license companies have a great upside potential when the gold price rises and hardly bear any mining risk. At the same time, the downside potential is low when precious metal prices go down. This is because they have a large number of active mines in their portfolios.
Not so long ago, many exploration companies put their projects on hold and started looking for investors. Often these projects were good, but uneconomical. Now the price of gold is high, and many exploration companies can now obtain financing more easily.
Licensing and streaming companies, which when gold was cheap in price, have now had an advantage with these exploration projects. This is because they bought cheaply, and the value of the projects has now increased with the price of gold.
As a result, GoldMining, itself owns many gold and copper projects, has formed its own company, the Gold Royalty Company. GoldMining has acquired gold deposits in 14 different areas in North and South America, creating value for its own royalty company.
Osisko Gold Royalties also belongs to the circle of licensing and streaming companies. With more than 135 precious metal purchases and streams, the company is highly diversified.
Recent company information and press releases from GoldMining (https://www.resource-capital.ch/en/companies/goldmining-inc/) and Osisko Gold Royalties (https://www.resource-capital.ch/en/companies/osisko-gold-royalties-ltd/).
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