
September 03, 2025
Brightstar Resources (BTR:AU) has announced High-grade RC assays and visible gold in Menzies DD drilling
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19 June
Brightstar Resources
Investor Insight
With multiple catalysts ahead, including resource upgrades, expanded production, and further development of its Laverton, Menzies, and Sandstone hubs, Brightstar Resources presents a compelling investment case in a rising gold market.
Overview
Gold has continued to demonstrate its resilience as a store of value, with prices peaking at US$3,500.05 per ounce, its all-time high. Amid ongoing global economic uncertainty, including inflationary pressures, rising geopolitical tensions, and volatile interest rate environments, investors have turned to gold as both a safe haven asset and a hedge against macroeconomic instability.
Brightstar Resources (ASX:BTR) is strategically positioned to capitalize on this environment as a low-cost, multi-asset gold developer with near-term production potential. The company controls over 1,500 square kilometers of highly prospective ground across three of Western Australia’s most prolific gold belts: the Laverton Tectonic Zone, the Menzies Shear Zone, and the Sandstone Greenstone Belt.
Unlike many junior exploration companies, Brightstar has a key differentiator: it owns a fully permitted, strategically located processing facility near Laverton. This existing infrastructure offers the company a critical advantage, enabling a low-capex restart scenario and faster time to cash flow compared to peers who must first secure permits and fund costly plant construction. This plant is subject of a DFS due for announcement in June 2025.
Through a focused multi-hub strategy, Brightstar has built a robust pipeline of development-ready and resource-growth projects, supported by:
- Over 3 million ounces of gold resources across Laverton, Menzies, and Sandstone;
- Ongoing high-grade drilling success in 2024 and 2025, including intercepts of up to 10m @ 43.8 g/t gold;
- A track record of low-cost, value-accretive acquisitions, such as Linden Gold Alliance and Alto Metals;
- A dedicated, in-house technical team executing on aggressive exploration, fast-tracked studies, and staged development.
With global gold demand remaining strong, Brightstar is well-positioned to deliver material shareholder value through its integrated production plan, supported by scalable infrastructure, a growing resource base, and access to capital. The company’s strategic approach includes combining brownfields development, organic exploration, and corporate M&A, placing it at the forefront of a new generation of Australian gold producers.
Company Highlights
- ASX-listed gold exploration and development company with a consolidated mineral endowment of 3 Moz of gold across Laverton, Menzies, and Sandstone hubs in Western Australia.
- Owns and operates 100 percent of project areas: 300 sq km in Laverton Tectonic Zone, 80 sq km in Menzies Shear Zone, and 1,200 sq km in Sandstone Greenstone Belt.
- Gold processing operations at the Laverton facility have commenced under an Ore Purchase Agreement (OPA) with Genesis Minerals Ltd (ASX:GMD), marking a significant milestone in transitioning from exploration to production.
- Recent drilling campaigns have yielded strong high-grade results, including:
- 16m @ 8.0 g/t gold at Second Fortune (Laverton)
- 10m @ 43.8 g/t gold at Musketeer (Sandstone)
- 16m @ 8.0 g/t gold at Yunndaga (Menzies)
- Following the successful Linden Gold Alliance acquisition, Brightstar has commenced a DFS for the wider development of its Laverton and Menzies assets which is due for release imminently in June 2025.
- Ongoing Sandstone drilling continues to return high-grade intercepts, further supporting project advancement and MRE conversion.
- In 2024, Brightstar signed a $4 million drill-for-equity deal with Topdrill to fast-track exploration at Sandstone.
- The company has successfully executed a US$11.5 million (AU$18 million) revolving stockpile finance facility with Ocean Partners Australia.
Key Projects
Laverton Hub
Brightstar’s Laverton hub is comprised of the Cork Tree Well, Jasper Hills, Second Fortune, Beta and Alpha project areas.
Highlights:
- Combined, the Laverton Hub JORC mineral resource estimate is 15.7 Mt @ 1.7 g/t gold for 848 koz (49 percent measured and indicated category). All mineral resources are on granted mining leases
- Cork Tree Well (6.4 Mt at 1.4 g/t gold for 292 koz gold)
- Alpha (1.4 Mt at 2.3 g/t gold for 106 koz gold)
- Beta (1.9 Mt at 1.7 g/t gold for 102 koz gold)
- Lord Byron (5.2 Mt at 1.5 g/t gold for 251 koz gold)
- Fish (376 kt at 4.0 g/t gold for 49 koz gold)
- Second Fortune (92 kt at 13.4 g/t gold for 40 koz gold)
- Gilt Key (168 kt at 1.3 g/t gold for 8 koz gold)
- Main project area Cork Tree Well is open at depth and along strike with recent drilling results of 34.4 meters at 7.94 g/t gold from 43.5 meters (CTWMET004) and 27.6 meters at 17.8 g/t gold from 51 m (CTWMET003)
- Second Fortune has a mineral resource estimate head grade of ~11g/t gold with an average ore body width of 0.6 meters.
- Jasper Hills is located 50 km from Brightstar’s existing processing facility along a wholly-owned private haul road, allowing unimpeded, direct access to both projects
- Permitted, previously mined and production-ready
- Last mined by current owners in 2020 with 23,000 oz gold mined
- Growth Drivers:
- Second Fortune: Consistent, stable production and cash generation through 2025
- Fish: Mining activities have commenced and site establishment is continuing.
- First ore production targeted in June
- Open pits development: Large scale production opportunities through mining Lord Byron and Cork Tree Well as multi-year base load ore sources
- DFS: due for delivery in June 2025, including design and costs for expansion of BTR-owned processing infrastructure to 1Mtpa.
Menzies Hub
The Menzies Hub comprises a tenement holding of a contiguous land package of granted mining leases over a strike length of more than 20 km. The majority of deposits hosted along the Menzies Shear Zone are located adjacent to the Goldfields Highway in Menzies (130km north of Kalgoorlie).
Highlights:
- Total Current Resource: 12.7 Mt at 1.4 g/t gold for 589 koz gold (37 percent measured and indicated)
- DFS: due for delivery in June 2025, including design and costs for open pit and underground mining for toll processing/ore sales to a regional Kalgoorlie-Menzies mill.
- Growth Drivers:
- Lady Shenton Open Pit: Proposed multi-year consistent open pit production to provide cash generation. Targeting approvals received and ‘mine ready’ in 2025
- Yunndaga Underground: Planned infill drilling targeting conversion of Inferred Mineral Resources to M+I to support inclusion in future mining operations – recent results from this program include 16m @ 8.0 g/t gold
- Development: Advancing discussions with regional mills for 3rd party processing capacity in the Kalgoorlie-Menzies region, targeting a mining decision.
Sandstone Hub
The consolidated Sandstone project is over 100 km from existing third-party milling operations in the Murchison. This third processing hub boasts Alto’s Sandstone project with a mineral resource of 1.05 Moz at 1.4 g/t gold and Gateway’s Montague gold project with a mineral resource of 0.5 Moz @ 1.6 g/t gold.
Growth Drivers:
- Sandstone: Upgrade the Lords, Vanguard, Indomitable and Havilah camps to Indicated classification (40,000m RC+DD)
- Montague: Infill Montague and Whistler to Indicated classification (5,000m RC and 1,200m DD) – RC
- Greenfields: Follow up drilling of priority prospects across Sandstone Hub (West Hacks, Hancocks, Bulchina, Lords Corridor, Duplex) – recent drilling success includes exceptional intercepts at the Musketeer prospect yielding 10m @ 43.8 g/t gold
- Pre-Feasibility Study: Incorporation of 2025 drilling results into MRE upgrades to then factor into 1H 2026 Sandstone PFS
Management Team
Alex Rovira - Managing Director
Alex Rovira is a qualified geologist and an experienced investment banker having focused on the metals and mining sector since 2013. Rovira has experience in ASX equity capital markets activities, including capital raisings, IPOs and merger and acquisitions.
Richard Crookes - Non-executive Chairman
Richard Crookes has over 35 years’ experience in the resources and investments industries. He is a geologist by training having previously worked as the chief geologist and mining manager of Ernest Henry Mining in Australia.
Crookes is managing partner of Lionhead Resources, a critical minerals investment fund and formerly an investment director at EMR Capital. Prior to that he was an executive director in Macquarie Bank’s Metals Energy Capital (MEC) division where he managed all aspects of the bank’s principal investments in mining and metals companies.
Andrew Rich - Executive Director
Andrew Rich is a degree qualified mining engineer from the WA School of Mines and has obtained a WA First Class Mine Managers Certificate. Rich has a strong background in underground gold mining with experience predominantly in the development of underground mines at Ramelius Resources (ASX:RMS) and Westgold Resources (ASX:WGX).
Ashley Fraser - Non-executive Director
Ashley Fraser is an accomplished mining professional with over 30 years experience across gold and bulk commodities. Fraser was a founder of Orionstone (which merged with Emeco in a $660-million consolidation) and is a founder/owner of Blue Cap Mining and Blue Cap Equities.
Jonathan Downes - Non-executive Director
Jonathan Downes has over 30 years’ experience in the minerals industry and has worked in various geological and corporate capacities. Experienced with gold and base metals, he has been intimately involved with the exploration process through to production. Downes is currently the managing director of Kaiser Reef, a high grade gold producer, and non-executive director of Cazaly Resources.
Dean Vallve – Chief Development Officer
Dean Vallve holds technical qualifications in geology & mining engineering from the WA School of Mines, an MBA, and a WA First Class Mine Managers Certificate. Vallve was previously in senior mining and study roles at ASX listed mid-cap resources companies Hot Chili (ASX:HCH) and Calidus Resources (ASX:CAI).
Nicky Martin – Chief Financial Officer
Nicky Martin is an experienced finance and accounting professional holding tertiary qualifications in accounting and finance and is a qualified CPA. Martin was previously the Head of Finance at Pilbara Minerals Ltd (ASX:PLS) where she oversaw and was actively involved in a rapidly growing mining success story.
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Emerging gold producer and district-scale resource developer in Western Australia
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Exceptional result of 32m @ 7gt Au in Lord Byron drilling
Brightstar Resources (BTR:AU) has announced Exceptional result of 32m @ 7gt Au in Lord Byron drilling
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Brightstar Resources (BTR:AU) has announced Fish Underground drilling underway for mine life extensions
12h
Joe Cavatoni: Gold Strong at Record Highs, What's Really Happening Now
Joe Cavatoni, senior market strategist, Americas, at the World Gold Council, discusses gold's ongoing price run, highlighting its key role in risk diversification.
He also notes that western investors are beginning to take a keener interest in gold.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
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12h
Zijin Mining Surges Past US$100 Billion Valuation Despite IPO Delay
The valuation of China's Zijin Mining Group (OTC Pink:ZIJMF,HKEX:2899,SHA:601899) has topped US$100 billion for the first time despite the firm's delayed initial public offering (IPO).
Shares of the Fujian-based miner closed at a record high in Shanghai on Thursday (September 25), giving the company a market capitalization of about 732 billion yuan (around US$132.4 billion), according to a Bloomberg report.
That puts Zijin just behind global heavyweights Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO), worth roughly US$112 billion, and BHP (ASX:BHP,NYSE:BHP,LSE:BHP) at about US$140 billion.
Founded by geologist Chen Jinghe in the 1980s with a small gold mine in Southeastern China, Zijin concentrated its expansion heavily on gold and copper, which together made up 77 percent of its revenue in the first half of 2025.
That focus has paid off handsomely in the current market climate, with copper prices hitting record averages and gold smashing through historical highs. Gold has been trading at unprecedented levels throughout September, with futures opening on Thursday at US$3,768.30 per ounce, up 1 percent from the previous day’s close of US$3,732.10.
Prices have consistently held above US$3,700 since September 22. Earlier this month, bullion reached an all-time peak of US$3,788.33, eclipsing the inflation-adjusted record set in January 1980.
Analysts attribute the rally to a weaker US dollar and widespread expectations of further US interest rate cuts.
Gold's strength has reinforced Zijin’s plans to spin off and list its overseas gold assets.
Zijin Gold International, which controls the company’s non-China gold mines, is seeking to raise about US$3.2 billion in what would be the world’s second largest IPO of 2025. The Hong Kong listing was initially scheduled for September 29, but has been pushed back a day to September 30 after Super Typhoon Ragasa battered the city.
The delay stems from Hong Kong exchange rules that automatically extend IPO subscription deadlines when a No. 8 or higher storm warning coincides with the final morning of the retail order period. Because Ragasa effectively shut down financial activity on Wednesday (September 24), Zijin’s offering was forced to adjust by 24 hours.
Despite the storm disruption, Zijin’s offering is expected to draw strong demand. Investors have been closely tracking the company’s trajectory, noting its ability to align growth with bullish commodity cycles.
Market observers say the IPO will also test investor appetite for large-scale resource listings in Hong Kong, which has seen a slowdown in new deals amid geopolitical tensions.
A US$3.2 billion raise would make Zijin Gold’s debut the largest in the city this year and second worldwide.
Don’t forget to follow us @INN_Resource for real-time news updates!
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
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13h
Top 5 Australian Mining Stocks This Week: Yandal Resources Climbs on Gold Drilling Results
Welcome to the Investing News Network's weekly round-up of the top-performing mining stocks listed on the ASX, starting with news in Australia's resource sector.
This week’s top performers are centered on a mix of resources, including gold, silver, platinum group metals and tungsten.
Australian resources and energy are a focus for the government this week, with a Tuesday (September 23) statement announcing that Minister for Resources and Northern Australia Madeleine King would travel to the Osaka World Expo in Japan this week “to promote Australian trade and industry and explore opportunities for Australian and Japanese firms to invest in Australia’s critical minerals industry to support global efforts to reduce emissions.”
“Energy security during the transition to net zero is a high priority for both of our nations,” she commented in the release.
In mining company news, Brightstar Resources (ASX:BTR,OTCQB:BTRAF) said that the Department of Mines, Petroleum and Exploration has approved its mining proposal and mine closure plan for the Lord Byron project in Western Australia.
Gateway Mining (ASX:GML) reported it has received firm commitments to raise AU$22.5 million to fund exploration and drilling at its flagship Yandal gold project as well as for initial exploration at its newly acquired Glenburgh South gold project, both in Western Australia.
Market and commodities price round-up
The S&P/ASX 200 (INDEXASX:XJO) posted a 1.35 percent decrease this week, opening at 8,864.90 on Monday (September 22) and closing at 8,745.20 on Thursday (September 25).
As for precious metals, the gold price spiked to a new all-time high this week in both US and Australian dollars. In US dollars, gold rose 1.52 percent from US$3,685.41 at Monday's open to US$3,741.27 by Thursday's close. In Australian dollars, gold also rose through the week, moving from AU$5,589.85 to AU$5,672.42 at a 1.48 percent increase.
The silver price also posted significant gains. It climbed 2.14 percent in US dollars, starting the week at US$43.06 per ounce and closing at US$43.98. In Australian dollars, silver rose 2.1 percent from AU$65.31 to AU$66.68.
Top ASX mining stocks this week
How did ASX mining stocks perform against this backdrop?
Take a look at this week’s five best-performing Australian mining stocks below as the Investing News Network breaks down their operations and why these companies are up this week.
Stocks data for this article was retrieved at 4:00 p.m. AEST on Thursday using TradingView's stock screener and reflects price movements between Monday and Thursday. Only companies trading on the ASX with market capitalisations greater than AU$10 million are included. Mineral companies within the non-energy minerals, energy minerals, process industry and producer manufacturing sectors were considered.
1. Yandal Resources (ASX:YRL)
Weekly gain: 75 percent
Market cap: AU$100.5 million
Share price: AU$0.280
Yandal Resources is a gold exploration company focused on Western Australia. The company is currently developing its flagship Ironstone Well-Barwidgee gold project located within the Yandal Belt.
The company is advancing the project’s Arrakis gold prospect at the Caladan target, at which it commenced reverse circulation drilling on September 1 and finished on September 17.
The company shared results from the drilling program on Monday (September 22). Results included significant intercepts of 54 metres at an average grade of 1.2 grams per tonne (g/t) gold from 108 metres, and 6 metres at 1.1 g/t gold from 180 metres.
The company requested a trading halt on Tuesday (September 23), pending an announcement. Regular trading commenced Wednesday alongside Yandal releasing further results from the drilling program and its annual shareholder report.
The results included 50 metres at 1.3 g/t gold from 122 metres, and 16 metres at 0.7 g/t gold from 140 metres.
“As we step out and consider the whole 2.2 kilometre trend initially defined by air-core drilling, the scale of this discovery begins to look regionally significant,” Managing Director Chris Oorschot commented.
Its annual shareholder report highlighted how its exploration over the past 12 months has been primarily on early-stage, large-scale target areas within the Ironstone Well-Barwidgee project, with minor activities also completed across the Mt. McClure and Gordons gold projects.
It also mentioned the Arrakis prospect as one of the priority target areas that have seen “rapid progress” during the year.
Shares of Yandal were the highest this week a day after the announcements, closing at AU$0.285 on Thursday.
2. Podium Minerals (ASX:POD)
Weekly gain: 66.67 percent
Market cap: AU$56.75 million
Share price: AU$0.070
West Perth-based Podium Minerals aims to be Australia’s first miner and producer of platinum group metals (PGMs) from its flagship Parks Reef project, which is currently transitioning from exploration to development. Parks Reef is located 80 kilometres west of Meekatharra, Western Australia.
Podium Minerals said on its website that Parks Reef hosts the largest platinum resource in Australia and the only 5E PGM mineral resource in Australia, a category that refers to platinum, palladium, rhodium, iridium and gold.
Parks Reef’s inferred mineral resource for its PGM zone totals 183 million tonnes of ore containing 7.6 million ounces of 5E PGMs at an average grade of 1.30 g/t, plus metals copper, nickel and cobalt.
In its annual shareholder report published on Wednesday, Podium Minerals highlighted the addition of an inferred mineral resource for Parks Reef’s Copper-Gold zone, which hosts 60 million tonnes containing 300,000 ounces of gold, 140,000 tonnes of copper, 60,000 tonnes of nickel and 11,000 tonnes of cobalt.
“The (copper-gold zone) increases the project’s scale, adds development flexibility and increases the overall value of Podium’s basket of metals,” Podium’s report reads.
Podium's shares peaked on Thursday at AU$0.070.
3. DevEx Resources (ASX:DEV)
Weekly gain: 64.89 percent
Market cap: AU$61.84 million
Share price: AU$0.155
Australia-focused DevEx Resources holds uranium assets in the Northern Territory, and one rare earth element project in Queensland.
Its Northern Territory projects are the Nabarlek project, which is wholly owned and hosts the past-producing Nabarlek uranium mine, and the Murphy West project, for which it has earn-in agreements.
DevEx began field exploration at the projects in July, and has secured government co-funding of AU$160,000 for drilling at Nabarlek’s Big Radon and KP prospects.
As for its rare earths project, the Kennedy ionic clay project, the company’s last website update is that further metallurgical testing is underway. This project holds a resource of 150 million tonnes at 1,000 parts per million total rare earth oxide.
While DevEx did not make any announcements this week, its shares spiked to a close of AU$0.140 on Wednesday.
This resulted in a price query from the ASX, which the company responded to on Thursday, saying that there is no undisclosed information affecting its trading.
Shares of DevEx closed at AU$0.170 on Thursday.
4. Terra Critical Minerals (ASX:T92)
Weekly gain: 63.93 percent
Market cap: AU$15.39 million
Share price: AU$0.10
Terra Critical Minerals is a critical minerals explorer with a growing portfolio in the New England area of New South Wales, Australia. It also holds a portfolio of uranium assets in Canada’s Athabasca Basin in Saskatchewan, and is looking to acquire rare earth element and antimony projects in the US.
Previously focused just on uranium, the company officially changed its name from Terra Uranium to Terra Critical Minerals on Tuesday to reflect its broader focus, which includes tungsten, tin and more.
On the same day, Terra announced that it has identified further high-grade silver mineralisation as part of its review of historical rock samples at its 100 percent-owned Mole River base metals project in New South Wales.
One highlighted sample at Mole River’s Silent Grove prospect graded 400 g/t silver, 6.09 percent lead, 4 percent zinc and 0.55 percent tin.
“Further review of historical datasets is ongoing,” the update read. “A full exploration program will be developed following the thorough analysis of past work.”
Terra’s other projects in the New England area include the past-producing Ottery tin mine, the Castle Rag silver deposit and the Glen Eden tungsten-molybdenum project, which hosts NSW's largest undeveloped tungsten deposit. The company closed its acquisition of Dundee Resources on September 16, adding the Glen Eden project and two others to its portfolio.
Shares of Terra reached a weekly high on Wednesday, closing at AU$0.10. The same record was seen on its Thursday close.
5. Manuka Resources (ASX:MKR)
Weekly gain: 52.94 percent
Market cap: AU$50.07 million
Share price: AU$0.052
Manuka Resources is a multi-commodity developer focused on restarting precious metals production in the Cobar Basin of New South Wales.
Its two prominent assets are the Mount Boppy gold mine and past-producing Wonawinta silver and base metals project, both located in the Cobar Basin.
According to the company, Mount Boppy remains fully permitted and holds an open pit probable ore reserve of 39,000 ounces of gold. It last produced gold in 2023 and is currently under care and maintenance.
“(With) newly identified exploration potential … Manuka plans a restart based on expansion and processing upgrades,” its project page states.
At Wonawinta, Manuka is targeting a restart of silver production in 2026.
Manuka also holds the Taranaki iron-vanadium-titanium (VTM) project, which is being advanced by Manuka’s subsidiary Trans-Tasman Resources. The project would extract vanadium-rich iron sands from the seabed of the New Zealand exclusive economic zone.
The company has completed its updated pre-feasibility study for Taranaki and entered the project in the New Zealand government’s fast-track approval process.
While no announcements were made by Manuka this week, its shares climbed to a weekly high of AU$0.052 at its close on Thursday.
Don’t forget to follow us @INN_Australia for real-time news updates!
Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.
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14h
Investing in Gold Royalty and Streaming Stocks
Gold royalty companies offer investors exposure to gold and silver with the benefits of diversification, lower risk and a steady income stream.
Royalty companies operating in the resource sector will typically agree to provide funding for the exploration or development of a resource in exchange for a percentage of revenue from the deposit if it begins producing. Similarly, a company with a streaming model may work out an agreement with a resource company for a share of the metal produced from a deposit in exchange for an investment.
These kinds of arrangements benefit both parties. Streamers get access to the underlying commodity at a fixed price and are shielded from cost overruns and spikes in production. Further, if there is a price decrease the metals can be warehoused until the market conditions improve. In both cases, mining companies receive considerable upfront investment during the expensive construction and expansion phases, and unlike loans these investments have longer-term payouts at a fixed amount.
Let's take a deeper look at how royalties and streaming works, their benefits and the gold and silver royalty and streaming stocks you can invest in.
In this article
How do gold and silver royalties work?
Gold and silver royalty agreements involve royalty companies agreeing to provide funding for the exploration or development of a precious metals resource in exchange for a percentage of revenue from the deposit if it begins producing metals.
The foundation for royalties dates back a few hundred years. Originally, they were payments made to the British monarchy in exchange for miners' rights to operate gold and silver mining operations on lands held by the crown. Today, these arrangements still exist, with mining operators paying the government a share of the revenues generated from exploiting resources on public lands.
The first royalty paid to a company in the gold sector was an agreement in 1986 in which Franco-Nevada (TSX:FNV,NYSE:FNV) made a US$2 million investment into Western States Minerals’ Goldstrike small heap-leach mine in Nevada, US, for a 4 percent share of revenues collected from the mine. Western States was sold the same year to Barrick Gold (TSX:ABX,NYSE:GOLD). Barrick discovered a far larger resource at the site and the royalty has since earned Franco-Nevada more than US$1 billion.
This early example set a precedent for the industry. It saw Franco-Nevada, which was then a gold exploration company, lock itself into what became one of the largest gold mineral resources in the world at a relatively low overhead while avoiding future costs associated with the growth and maintenance of the mine.
How do gold and silver streams work?
Gold and silver streams work in a similar manner to the royalty model but returns are in the form of physical metals rather than funds. In return for investing in an asset, a gold streaming company may work out an agreement with a resource company for a share of the metal produced from a deposit, or for the ability to purchase the metal at a lower price than market value.
This is also a popular model with base metal mining companies whose operations result in gold and/or silver by-products. In these cases, gold and silver streaming companies may work out a deal with a base metal mining operation to take delivery of a certain amount of precious metals at an agreed upon price.
The Goldstrike royalty made Franco-Nevada what it is today, but its largest contributing asset in its portfolio is a deal with Lundin Mining (TSX:LUN,OTC Pink:LUNMF) for a stream of the gold and silver resources extracted from its Candelaria copper mine in Chile.
Under the terms of the deal, which was part of Lundin’s 2014 acquisition of Freeport-McMoRan’s (NYSE:FCX) stake in Candelaria, Franco-Nevada provided a US$648 million deposit in exchange for a 68 percent stream of the asset's silver and gold. This will lower to 40 percent once 720,000 ounces of gold and 12 million ounces of silver have been delivered, which the company currently predicts will take place in 2027.
While Franco-Nevada does have to pay for the metal, the agreed upon amount is far under the current market value. At the time, the deal was set at US$400 for each ounce of gold and US$4 per ounce of silver with a 1 percent inflationary adjustment, or market price if that was less.
Are royalty and streaming companies a good investment?
Royalty and streaming companies are largely seen as a lower-risk investment than mining companies. Lower operational costs and higher portfolio diversification means they are hedged against a mine shutdown, natural disaster, market forces or the politics that may affect the nature of an operation or project. However, that’s not to say royalty and streaming deals aren’t without their risks.
In many ways, gold royalty companies are like venture capitalists in the tech industry, working to fund many projects in the hopes that some will see big payoffs that offset the loss from the ones that don’t make it. This means they need large access to funding in order to build their portfolios.
To get funding, royalty and streaming companies have several options: using cash on hand, raising debt through loans or issuing more shares. Each of these options carries risk. Using cash to pay for investments could reduce the size of the safety net and eat into company liquidity, debt needs to be managed to ensure that payments don’t exceed income and the issuance of stock could lead to an overall devaluation of share price and impact investor sentiment.
Once companies have developed strong cash flows and good liquidity, they are able to take advantage of their own reserves, without the need to worry about loans or stock dilution. The same cannot be said for the up-and-coming companies who need to rely on external funding to make deals, making them riskier.
These companies provide a good entry point for investors with lower share price, and have more potential to return higher percentage gains in share price, they also bear more risk. With more reliance on raising external capital, there is a greater need for deals to be successful and a greater chance for a company to incur more debt load or stock dilution.
Diverse portfolios can help reduce the risk associated with a royalty company, and companies like Franco-Nevada have the industry knowledge and financial capital to take some risks. As of February 2025, the company has 430 assets on their books; of those, 119 are producing, and 38 are in the advanced stages of development. It’s the 273 more that are in the exploration phase, many of which will never provide returns, that represent the greatest risk.
Of course, unforeseen events can affect both mining and royalty companies alike, particularly when assets that take up a larger percentage or a portfolio are affected. Franco-Nevada had more than US$1 billion invested in First Quantum’s (TSX:FM,OTC Pink:FQVLF) Cobre Panama mine before it was shuttered by the Panamanian government following protests at the end of 2023. The mine brought in US$223.3 million for Franco-Nevada in 2022 and represented nearly a quarter of its precious metal income. While it fared better than First Quantum, the royalty company's share price took a significant hit.
Gold and silver royalty companies
The biggest companies in the precious metals royalty and streaming space have long histories and have built positive reputations on the backs of strong investments. They offer a means for investors to de-risk an entry into the gold sector by maintaining an arms-length attachment to it.
The five gold and silver royalty and streaming companies on this list had market caps above $1 billion in their respective currencies as of September 23, 2025.
1. Wheaton Precious Metals (TSX:WPM,NYSE:WPM)
Market cap: C$67.59 billion
Wheaton Precious Metals was established in 2004 as Silver Wheaton with a focus on silver streaming. Goldcorp held a majority interest, but began to reduce it in 2006 and by 2008 had completely divested itself. By that time, Silver Wheaton had begun to diversify into other precious metals. The following year, Silver Wheaton acquired rival silver streaming stock Silverstone Resources in a C$190 million deal.
Silver Wheaton changed its name in 2017 to Wheaton Precious Metals and has since built itself into one of the largest players in the gold and silver royalty and streaming space, with investments in 16 operating mines and 23 development projects across five continents.
Included in Wheaton's assets are investments in Newmont's (TSX:NGT,NYSE:NEM,ASX:NEM) Peñasquito mine in Mexico, Sibanye Stillwater's (NYSE:SBSW) Stillwater and East Boulder mines in Montana, US, and Hudbay Minerals' (TSX:HBM,NYSE:HBM) Copper World Complex project in Arizona, US.
2. Franco-Nevada (TSX:FNV,NYSE:FNV)
Market cap: C$57 billion
A trailblazer in the gold royalty business, Franco-Nevada has set a high bar. The current iteration of the company was spun out of Newmont in what became a C$1.1 billion initial public offering, one of the biggest IPOs of 2007.
Franco-Nevada now has a portfolio of royalties and streams on 119 producing assets around the world including gold, silver, base metal and oil and gas operations, which generate more than US$1.2 billion for the company annually.
Among the producing assets for which Franco-Nevada has precious metals streams and royalties are Glencore's (LSE:GLEN,OTC Pink:GLCNF) Antapaccay mine in Peru, Agnico Eagle's (NYSE:AEM,TSX:AEM) Detour Lake mine in Ontario, Canada, and Gold Fields' (NYSE:GFI) Salares Norte mine in Chile.
See the sections above for more information on Franco-Nevada's royalty and streaming deals.
3. Royal Gold (NASDAQ:RGLD)
Market cap: US$13.63 billion
Royal Gold got its start in 1981 as oil and gas exploration and production company Royal Resources.
Responding to shifts in the overall resource market, by 1987, Royal Gold was born with a focus on building a portfolio of minority positions in significant gold properties operated by major mining firms.
Today, Royal Gold is a leading precious metals streaming and royalty company with interest in 175 properties, of which 42 are producing assets, across 17 countries.
Among its assets are Barrick Mining (TSX:ABX,NYSE:B) and Newmont's Cortez mine in Nevada, US, Teck's (TSX:TECK.A,TECK.B,NYSE:TECK) Andacollo mine in Chile and Centerra Gold's (TSX:CG,NYSE:CGAU) Mount Milligan mine in British Columbia, Canada.
Royal Gold is planning to acquire Sandstorm Gold, the fifth largest gold royalty company on this list. The deal is expected to close in the fourth quarter of 2025.
4. OR Royalties (TSX:OR,NYSE:OR)
Market cap: C$5.1 billion
Previously named Osisko Gold Royalties, OR Royalties was created in 2014 as a spinoff deal between Osisko Mining (TSX:OSK), Yamana Gold and Agnico Eagle Mines (TSX:AEM,NYSE:AEM). The deal was made in an attempt to prevent a hostile takeover of Osisko Mining and its Canadian Malartic gold complex by Goldcorp, now part of Newmont.
In the deal, OR Royalties carried with it a 5 percent net smelter return royalty from the Canadian Malartic mine. Now owned by Agnico Eagle, the complex in Québec remains a cornerstone of the royalty company's business today.
The gold and silver royalty and streaming company has gone on to amass royalties, streams and offtakes for 195 assets, 21 of which are producing, across six continents.
The majority are located in North America, including one of the most well-known gold-producing mines in the world, Agnico Eagle's Canadian Malartic complex in Québec, as well as SSR Mining's (NASDAQ:SSRM,TSX:SSRM) Seabee mine in Saskatchewan, Canada, and Kinross Gold's (TSX:K,NYSE:KGC) Bald Mountain mine in Nevada.
5. Sandstorm Gold (TSX:SSL,NYSE:SAND)
Market cap: C$3.51 billion
Sandstorm Gold Royalties was founded in 2008 as a small startup and has since become a multi-billion dollar gold and silver royalty and streaming company.
Sandstorm’s royalty portfolio boasts more than 230 assets, of which 40 are producing assets, located across more than a dozen countries.
Its producing assets include Pan American Silver's (TSX:PAAS,NYSE:PAAS) Ceo Moro mine and Cerrado Gold’s (TSX:CERT,OTCQX:CRDOF) Las Calandrias mine, both located in Argentina, as well as Ivanhoe's (TSX:IVN,OTCQX:IVPAF) Platreef mine in South Africa.
Sandstorm is set to be acquired by fellow royalty company Royalty Gold in a deal expected to close in Q4.
Small-cap gold and silver royalty companies
There are also small-cap gold and silver royalty and streaming companies you can invest in and offer a lower-cost option for investors who are comfortable with a little more risk. Like their larger counterparts, small-cap gold royalty stocks offer a lower-risk investment than getting into a small-cap mining company but still provide access to the underlying precious metals market.
The five small-cap gold and silver royalty companies on this list had market caps above $10 million in their respective currencies as of September 23, 2025.
1. Gold Royalty (NYSEAMERICAN:GROY)
Market cap: US$648.7 million
Gold Royalty is building a diversified portfolio of more than 240 gold royalty and gold streaming interests based on net smelter return royalties on properties in the Americas.
The company’s revenue generating investments include Agnico Eagle's Canadian Malartic complex in Québec, Dundee Precious Metals' (TSX:DPM) Vareš mine in Bosnia and Herzegovina, and Discovery Silver's (TSX:DSV,OTCQX:DSVSF) Borden mine in Ontario.
2. Metalla Royalty & Streaming (TSXV:MTA)
Market cap: C$752.37 million
Metalla Royalty & Streaming focuses on gold, silver and copper projects. The company’s royalty model involves acquiring royalties and streams by offering resource companies Metalla shares and cash.
The mid-tier royalty and streaming company’s asset portfolio includes more than 100 projects across North America, South America and Australia. Its cornerstone assets include IAMGOLD (TSX:IMG,NYSE:IAG) and Sumitomo Metal Mining’s (OTC Pink:SSUMF,TSE:5713) Côté gold mine in Ontario, Canada, and First Quantum Minerals' (TSX:FM) Taca Taca project in Argentina.
3. Sailfish Royalty (TSXV:FISH,OTCQX:SROYF)
Market cap: C$227.57 million
Founded in 2014, Sailfish Royalty’s asset portfolio is much smaller than the other gold royalty stocks on this list. It consists of one producing mine as well as two development-stage and two exploration-stage properties in the Americas.
In Nicaragua, Sailfish has a gold stream equivalent to a 3 percent net smelter return on Mako Mining's (TSXV:MKO,OTCQX:MAKOF) San Albino gold mine and a 2 percent net smelter return on the area surrounding the mine. The company also holds a 13,500 ounce per quarter silver stream at the property, which was set to expire in May 2025. At the end of April, Sailfish chose to exercise its option to purchase all silver for the life of the mine.
4. Empress Royalty (TSXV:EMPR,OTCQX:EMPYF)
Market cap: C$113.23 million
Empress Royalty’s business model involves investing in mining companies in various stages of exploration through production who need further non-dilutive capital to fund their projects and operations.
Empress’ gold and silver royalty and streaming portfolio includes 10 exploration assets in Canada and four producing assets, with two in the Americas and two in Africa: the privately owned Sierra Antapite mine in Peru, Luca Mining’s (TSXV:LUCA,OTCQX:LUCMF) Tahuehueto mine in Mexico, the privately owned Manica mine in Mozambique and Golconda Gold’s (TSXV:GG,OTCQB:GGGOF) Galaxy gold mine in South Africa.
Empress has a silver stream for Tahuehueto and gold streams for the other three mines.
5. Silver Crown Royalties (CBOE:SCRI,OTCQX:SLCRF)
Market cap: C$17.34 million
Silver Crown Royalties is a revenue-generating silver-only royalty company focusing on silver as by-product credits. The company targets royalty originations on producing or near-producing assets in tier 1 jurisdictions.
Silver Crown has royalties on two producing assets in its portfolio: Gold Mountain Mining’s (TSX:GMTN) Elk gold project in British Columbia, Canada, and private Canadian company Pilar Gold’s PGDM mine in Brazil.
Gold and silver royalty ETFs
Those who want more broad exposure to the precious metals markets may want to buy shares of an exchange-traded fund that includes gold and silver royalty and streaming stocks. Here are a few to get you started, including ASX gold ETFs and a US gold ETF.
Betashares Global Royalties ETF (ASX:ROYL)
The Betashares Global Royalties ETF is an Australian ETF that tracks the performance of an index of global companies that earn a significant amount of their revenue from royalty income, royalty-related income and intellectual property income. The fund’s top two holdings are Wheaton Precious Metals and Franco-Nevada, with Royal Gold and OR Royalties also among its significant holdings.
Betashares Global Gold Miners ETF (ASX:MNRS)
The Betashares Global Gold Miners ETF tracks the performance of an index of the world’s largest gold mining companies outside of Australia, hedged into Australian dollars. Wheaton Precious Metals, Franco-Nevada and Royal Gold are also among the fund’s top holdings.
VanEck Gold Miners ETF (ARCA:GDX)
The VanEck Gold Miners ETF is a US gold ETF that aims to replicate the performance of the MarketVector Global Gold Miners Index by holding large-cap gold mining stocks and precious metals royalty companies. As with the other gold ETFs on this list, its top holdings include Franco-Nevada, Wheaton Precious Metals and Royal Gold.
This is an updated version of an article first published by the Investing News Network in 2024.
Don't forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Dean Belder, hold no direct investment interest in any company mentioned in this article.
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24 September
St. Davids Capital Inc. and Thistle Resources Corp. Enter Definitive Agreement for Qualifying Transaction
St. Davids Capital Inc. (TSXV: SDCI.P) ("St. Davids" or the "Company") and Thistle Resources Corp. ("Thistle") are pleased to announce that, further to the news release dated July 10, 2025, they have entered into a definitive acquisition agreement dated September 15, 2025 (the "Acquisition Agreement") in respect of the previously announced arm's length "qualifying transaction" (the "Qualifying Transaction"), as such term is defined in Policy 2.4 - Capital Pool Companies of the TSX Venture Exchange (the "TSXV") Corporate Finance Manual. In this news release, the term "Resulting Issuer" refers to the Company after the closing of the Qualifying Transaction.
Thistle Resources Corp.
Thistle is incorporated pursuant to the Business Corporations Act (Ontario) (the "OBCA") on September 1, 2017. Thistle has focused on critical minerals exploration in the Bathurst Mining Camp, New Brunswick, Canada. Thistle utilizes cutting edge technology paired with AI and proprietary algorithms to advance its project portfolio and increase shareholder value.
Key Terms of the Acquisition Agreement and Qualifying Transaction
On September 15, 2025, the Acquisition Agreement in respect of the Qualifying Transaction was entered into by the Company, Thistle and 1001354705 Ontario Inc. ("Subco"), a wholly-owned subsidiary of the Company incorporated for the purpose of completing the Amalgamation (as defined herein).
The Acquisition Agreement provides for, among other things, a three-cornered amalgamation under the OBCA, among the Company, Thistle, and Subco (the "Amalgamation"), pursuant to which, among other things:
- Thistle will amalgamate with Subco under Section 174 of the OBCA to form one corporation;
- each common share of Thistle (each, a "Thistle Share") outstanding immediately prior to the effective time (the "Effective Time") of the closing of the Qualifying Transaction that is held by a shareholder of Thistle (a "Thistle Shareholder") will be exchanged for one (1) common share of the Company (the "Common Shares"); and
- all convertible securities of Thistle outstanding immediately prior to the Effective Time will be cancelled and replaced with equivalent convertible securities of the Resulting Issuer, entitling the holders thereof to acquire Common Shares in lieu of Thistle Shares.
In addition, prior to the Effective Time, the Company intends to effect a change of its corporate name to "Thistle Resources Inc." or such other name as determined by Thistle and is acceptable to the applicable regulatory authorities (the "Name Change").
The Amalgamation will result in the reverse takeover of the Company by Thistle Shareholders and will constitute the Company's "qualifying transaction".
Upon completion of the Qualifying Transaction, it is anticipated that the Resulting Issuer will be listed as a Tier 2 Mining Issuer on the TSXV (as defined by the policies of the TSXV).
The closing of the Qualifying Transaction will be subject to the receipt of all requisite regulatory approvals (including the approval of the TSXV), requisite shareholder approvals and the satisfaction of other customary conditions.
For additional information relating to the terms of the Qualifying Transaction, please refer to a copy of the Acquisition Agreement, which will be filed and made available in due course on SEDAR+ (www.sedarplus.ca) under the Company's issuer profile, as well as the news release dated July 10, 2025, which is available on SEDAR+ (www.sedarplus.ca) under the Company's issuer profile. Additional information regarding the proposed Name Change and other corporate ancillary matters to be considered at the special meeting of shareholders on November 10, 2025 (the "Meeting") will be available in the Company's management information circular to be filed in due course on SEDAR+ (www.sedarplus.ca) under the Company's issuer profile.
Financing
In connection with and as a condition to the Qualifying Transaction, the Company intends to complete an equity financing (the "Financing") to be completed concurrently with the closing of the Qualifying Transaction through a private placement of: (i) non-flow through units (the "NFT Units") at an issue price of $0.20 per NFT Unit, with each NFT Unit comprised of one share of the Company and one warrant ("Warrant"), with each whole Warrant exercisable into one share of the Resulting Issuer for a period of two years at an exercise price of $0.30 per share; (ii) flow through units (the "FT Units") at an issue price of $0.25 per FT Unit, comprised of one flow through share of the Company (the "FT Share") and one Warrant; and (iii) charity flow through-units (the "Charity FT Units", and together with the NFT Units and FT Units, collectively the "Units") at an issue price of $0.30 per Charity FT Unit, comprised of one FT Share and one Warrant, for gross proceeds of a minimum of $1,750,000 and a maximum of $3,500,000 (the "Private Placement"). The Financing is subject to approval of the TSXV.
The Company has engaged Research Capital Corporation ("RCC") to serve as lead agent on a commercially reasonable best-efforts basis in connection with the Private Placement. The securities will be sold to "accredited investors" pursuant to exemptions from prospectus requirements under Canadian securities laws and/or in jurisdictions other than Canada that are mutually agreed to by the Company and RCC.
The Company has granted RCC an option, exercisable in whole or in part by RCC by giving notice to the Company at any time up to 48 hours prior to the closing of the Private Placement to sell up to an additional number of Units equal to 15% of the base Private Placement size at the issue price of such Units.
RCC will be paid a cash fee (the "Agent's Fee") of 8.0% of the gross proceeds of the Private Placement. Notwithstanding the foregoing, the Agent's Fee will be reduced to 4.0% for gross proceeds received by certain parties identified by Thistle (the "President's List"). RCC will also be granted a number of compensation warrants (the "Compensation Warrants") equal to 8.0% of the number of Units issued to investors in the Private Placement (reduced to 4.0% for President's List subscribers). Each Compensation Warrant will be exercisable for one unit (the "Compensation Units") at an exercise price of $0.20 per Compensation Unit for a period of 24 months following the closing date of the Private Placement with each Compensation Unit comprised of one share and one Warrant. RCC will receive a corporate finance services fee of $50,000 on completion of the Private Placement.
The net proceeds of the Private Placement will be used for exploration expenses on Thistle's mining projects and working capital and general corporate purposes.
St. Davids Capital Inc.
St. Davids was incorporated under the Business Corporations Act (Ontario) on August 4, 2021 and is a Capital Pool Company (as defined in the policies of the TSXV) listed on the TSXV. St. Davids has no commercial operations and no assets other than cash.
Cautionary Note Regarding Forward-Looking Information
This press release contains statements that constitute "forward-looking information" ("forward-looking information") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking information and are based on expectations, estimates, and projections as of the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events, or performance (often but not always using phrases such as "expects", "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budgets", "schedules", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events, or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking information.
In disclosing the forward-looking information contained in this press release, the Company has made certain assumptions, including that the Private Placement will be completed on acceptable terms and all applicable shareholder and regulatory approvals for the Qualifying Transaction will be received. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, it can give no assurance that the expectations of any forward-looking information will prove to be correct. Known and unknown risks, uncertainties, and other factors may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Such factors include but are not limited to: availability of financing; delay or failure to receive board, shareholder, or regulatory approvals; and general business, economic, competitive, political, and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking information contained in this press release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking information to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking information, or otherwise.
For further information, please contact:
St. Davids Capital Inc.
Rocco Racioppo
rocrac80@gmail.com
Thistle Resources Corp.
Patrick J. Cruickshank
patrick@thistleresources.com
All information provided in this press release relating to Thistle has been provided by management of Thistle and has not been independently verified by management of the Company.
Completion of the Qualifying Transaction is subject to a number of conditions, including but not limited to TSXV acceptance. Where applicable, the Qualifying Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Qualifying Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the filing statement (or other applicable disclosure document) of St. Davids to be prepared in connection with the Qualifying Transaction, any information released or received with respect to the Qualifying Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of St. Davids should be considered highly speculative.
The TSXV has in no way passed upon the merits of the Qualifying Transaction and has not approved or disapproved of the contents of this news release.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
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24 September
How to Use Gold Investments as a Hedge
It can be tempting for investors to focus on specific assets or strategies when building an investment portfolio, but those taking a long-term approach will want to diversify in order to balance out potential portfolio instability.
Gold has a reputation for being a reliable diversifier because it can act as a hedge against various risks.
For those unfamiliar with the term, put simply, a hedge is an investment position whose main purpose is to offset potential losses or gains related to another asset. But how does that work, and what's the best way to get exposure to gold as a hedge?
Read on for a look at how this strategy works and why it's worth considering.
In this article
Why use gold investments as a hedge?
Gold is looked at as a hedge investment in many different situations. The first and most popular use of gold as a source of protection is as a hedge against the decline of a currency, typically the US dollar. When the dollar slips, the yellow metal not only becomes less expensive to hold, but also tends to rise in value.
“Gold’s relationship with the dollar is determined by US-based gold supply and demand, as well as by the status of the dollar as the reserve currency globally,” states the World Gold Council. “Historically, a weak dollar tends to provide a stronger boost to gold’s performance than the drag created by a strong dollar.”
By holding the precious metal as a diversification tool when the economy negatively affects currencies, investors can incur gains from the metal’s increased value.
The second reason why gold makes a good hedge is that it can act as a defense against inflation. When the cost of living begins to rise, the stock market often falls. In those cases, investors with assets that are negatively affected by a volatile market need something to balance that out — that’s where gold comes in.
Over the past 50 years, investors have seen gold make huge gains when the stock market is crumbling. As Investopedia points out, “This is because, when fiat currency loses its purchasing power to inflation, gold tends to be priced in those currency units and thus tends to arise along with everything else.”
Interestingly, the yellow metal has also been used as a hedge against deflation, which happens when prices drop, the economy is in a downturn and excessive debt looms. This situation has not occurred since the Great Depression of the 1930s, and to a much smaller degree after the 2008 financial crisis.
Market participants may decide to hoard cash in this type of scenario, and the safest place to hold cash is in gold. Again, while this situation is not commonplace, many investors keep the yellow metal in their portfolios on the off chance that another massive period of deflation will take place.
Finally, gold can be used as a general portfolio hedge when market participants hold investments that are not related to one another. Since the precious metal generally has a negative correlation to stocks, bonds and other financial instruments, investors often diversify by creating a portfolio that combines gold with stocks and bonds in order to reduce both volatility and risk.
While it is true that the yellow metal goes through times of volatility, it has always maintained its value over the long term, making it a steady addition to investors’ portfolios.
Those who have decided to add gold to their portfolio as a hedge have a variety of options. Here’s an overview of three of the most popular ways of getting exposure to gold.
1. How to use physical gold as a hedge
Investors can get the most direct exposure to gold by buying physical gold, and holding the physical metal also adds diversification from digital assets. Physical gold can be purchased through government mints, private mints, precious metals dealers and even jewelry stores.
Physical gold investors should generally focus on 0.999 fine items, as these will also be the easiest to sell. The majority of gold bullion products fit this description.
One of the most common choices for investors are gold bullion coins, such as the South African Krugerrand or the Canadian Gold Maple Leaf, which are 0.999 fine. The American Gold Eagle is reputable and popular as well, but has a lower purity at 91.67 percent. Another option is gold rounds, which are similar to coins, but are not legal tender, making them often slightly cheaper.
Gold bars are another popular option, and because they come in a variety of sizes, they can accommodate a range of investors. Large investments may best be made in bars since bigger sizes are available. Further, it is often easier to manage several large products than it is to manage an array of smaller gold items.
When deciding on what to purchase, gold buyers will want to keep their plans for selling in mind. For example, large products may be more difficult and thus slower to sell, meaning it could be harder to take advantage of gold price movements or convert it to cash in an emergency. Individuals making ongoing or significant investments may therefore want to consider purchasing gold in various weights to give them versatility.
Click here to learn more about physical gold as an investment.
Click here to learn what moves the gold price and the highest price for gold is.
2. How to use gold ETFs as a hedge
One of the common ways investors add gold as a hedge is through investing in a gold exchange-traded fund (ETF), which trade on a stock exchange just like equities. There are several kinds of gold ETFs, offering exposure to different aspects of the gold market. Gold ETFs can offer investors access to gold price movements by holding physical gold or the gold futures market through holding futures contracts. There are also gold ETFs focused on gold mining stocks, providing a more stable alternative to investing in individual gold stocks.
It is important to keep in mind that investors who own gold ETFs do not own any physical gold — even gold ETFs that track physical gold generally cannot be redeemed for it, with the exception of the Vaneck Merk Gold ETF (ARCA:OUNZ). Nonetheless, gold ETFs are a good option for getting exposure to the precious metal without personally trading physical gold, gold futures or gold stocks.
Click here for a list of five biggest gold ETFs and more information on gold ETFs.
Click here for a list of top ASX-listed gold ETFs.
3. How to use gold futures as a hedge
A futures contract is an agreement to buy or sell gold on a date in the future for a price determined when the contract is initiated. In a gold futures transaction, two parties agree on a price, the amount of gold being purchased and the future delivery month.
The futures market is often referred to as an arena for paper trading. The bulk of the activity is just that, as metal is not actually exchanged and settlements are made in cash. It allows investors to buy or sell gold as they want without management fees, and taxes are split between short-term and long-term capital gains.
In some cases, the futures market can be an arena for purchasing physical gold. However, obtaining gold through the futures market requires a large investment and involves a list of additional costs. The process can be complicated, cumbersome and lengthy, which is why actually buying physical gold through futures is considered best for highly experienced market participants.
Click here to learn more about gold futures.
This is an updated version of an article first published by the Investing News Network in 2019.
Don’t forget to follow us @INN_Resource for real-time news updates!
Securities Disclosure: I, Lauren Kelly, hold no direct investment interest in any company mentioned in this article.
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