The Gold Report
Notable Quotes
"ICG has closed a CA$2.5M flow-through placement." (12/24/15) Integra Gold Corp. - Thibaut Lepouttre, Caesars Report More >
"The exploration upside at MAG's Juanicipio project is substantial." (12/23/15) MAG Silver Corp. - Gwen Preston, Resource Maven More >
"AKG's management continues to deliver on its development milestones." (12/22/15) Asanko Gold Inc. - Nana Sangmuah, Clarus Securities More >
"We are initiating coverage on KDX with a Buy rating." (12/21/15) Klondex Mines Ltd. - Don Blyth, Paradigm Capital More >
"VIT's Eagle is a shovel-ready, fully permitted, prefinanced gold project." (12/17/15) Victoria Gold Corp. - Tom Hayes, Edison Investment Research More >
Long-Time Long-Term!
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GEORDIE MARK, Haywood Securities
(07/28/2010)
As the absolute spread decreases, the opportunity for convergence trades decreases. The week: UxC U3O8 Spot Price starts the week up US$4.25, adding to last week's small uptick, while uranium funds increased by a slightly greater amount, on average, on an asset value-weighted basis, tightening the Spot:FIP (Fund Implied Price) spread, with the FIP of uranium below Spot Monday. The Spot:FIP spread has decreased in absolute terms, as it moved from $1.33 to $1.21, still above its recent average in absolute terms. This week's moving average of $0.12 The Spot:FIP spread remained in positive territory (Spot > FIP). A positive Spot:FIP spread means unencumbered physical uranium held in funds is, on average, priced below the prevailing Spot market value. Negative FIP spreads have historically been a bullish indicator for the Spot Price, and we note that for much of June, ahead of the current rally in spot price, the Spot:FIP was negative. We note the SPOT:T&P FIP spread was positive Monday. Our U-T FIP estimate is currently below Spot and BAP (Broker Average Price). We continue to see opportunity in uranium funds that are trading below their net asset values. Our TSX:U (target C$7.50) NAV shows a FIP (Jul 26) of US#1.93 below Spot ($42.13 or $0.48 above Spot (Jul 190)) |
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Under SEC rules, analysts are required to disclose their interest in securities that they cover. We strongly encourage you to contact them to understand any potential conflicts of interest they may have.
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