After 1,200 trading days, or 5 years, commodities are booming again and are in a new bull market now for 5 months. Since mid-January, silver gained up to 32%, gold 22%, platinum 35%, palladium 33%, zinc 35%, copper 18%, lead 17%, nickel 16% and aluminum 15%. WTIC oil rallied up to 81% since mid-February, while natural gas appreciated by up to 43% since March. Although lithium is on the rise since a few years already, we are experiencing parabolic prices since the end of last year. A popular method to profit from appreciating commodity prices is by investing in mining stocks. A rule of thumb says that when the gold price increases by 1%, the best gold stocks increase by more than 3%. In reality, the HUI gold mining index gained up to 138% since mid-January, hence 6 times as much as the gold price (the early phases of a bull market typically create strongest gains). The time seems ripe, especially for one company as it offers unmatched exposure to both exploration/discovery upside as well as increasing commodity prices.
The HUI index only includes the big seniors, respectively already producing gold mines. However In bull markets, stocks from exploration companies (juniors) typically appreciate much stronger than senior mining stocks because much more risks are involved. For such reasons, it is recommended to pick dozens of juniors in order to minimize risks via diversification.
In bull markets, so-called prospect/project generators gain popularity for a good reason, as they function and are appreciated like investment funds due to investing in dozens of exploration projects/companies globally, yet with a sound focus on “safe” mining jurisdictions.
One of the better known prospect generators is Vancouver-based Zimtu Capital Corp., which is listed on the Venture Exchange in Canada (TSX.V: ZC) and in Germany (ZCT1), in which I invested my own money and have been working for a number of years now, getting paid monthly. Besides its people, Zimtu’s assets include an ever growing portfolio of equity stakes. Currently, this investment issuer holds interests in +40 publicly listed and +15 privately held companies (mostly focused on mineral resource exploration; whereas some private companies may become public in future, as happened in the past, adding constantly new equity holdings into its portfolio).
Somewhat unique with Zimtu is that they also prospect, stake and acquire properties and projects regularly with their in-house geologists and/or staking partners. On top of that, Zimtu also creates and builds new companies from scratch on, i.e. participating at the lowest possible price levels.
All of these core businesses ensure that Zimtu’s portfolio is growing strongly, especially in bull markets, adding assets (equity) regularly. Alone in the last couple of months, Zimtu added 4 lithium companies into its portfolio, besides numerous other highly prospective juniors in which Zimtu feels is the right time to invest. And they did not stop that model during the last 5 years of a bear market but recognized the opportunities and made some spectacular deals and acquisitions, as Rockstone opines just in time and ready for the next bull market. In other words, watch out for Zimtu over the next weeks and months as they have some quite hot irons in the oven, as we Germans like to say. Strike while the iron’s hot. With less than 16 million shares issued and outstanding, Zimtu Capital is a relatively tightly held company, in which management and insiders control significant stakes.
On June 14, Zimtu will host its own, inaugural show in downtown Vancouver, the Vancouver Commodity Forum, with key note speakers including Joe Martin, Chris Berry, John Kaiser and Stephan Bogner. The CEOs of Zimtu’s top holdings will be exhibiting and presenting during the show as well, providing the perfect location and maybe the best time of the year to network with highly interesting people and learn about the upcoming success stories that this junior prospect generator is believed to have up its sleeve.
Zimtu Capital, in cooperation with Rockstone Research, will launch an innovative smartphone app shortly, comparing all interlisted stocks (i.e. all stocks listed in Canada and Germany). Sign up for the free Rockstone email Newsletter to hear first about the app, as well as news from the commodity markets and its companies.
Zimtu Capital Corp.
Suite 1450 - 789 West Pender Street
Vancouver, BC, V6C1H2 Canada
Phone: +1 604 681 1568
Shares Issued & Outstanding: 15,394,483
Canadian Symbol (TSX.V): ZC
Current Price: $0.175 CAD (May 6, 2016)
Market Capitalization: $3 million CAD
German Symbol / WKN (Frankfurt): ZCT1 / A0RDR9
Current Price: €0.121 EUR (May 6, 2016)
Market Capitalization: €2 million EUR
Disclaimer: Please read the full disclaimer within the above mentioned full research report as a PDF (here), because fundamental risks and conflicts of interest exist.