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Orefinders Updates Investment Thesis, Provides View on How Recent Gold Price Movements Impacts the Juniors
Orefinders Updates Investment Thesis, Provides View on How Recent Gold Price Movements Imp...
About this update from Orecap Invest Corp
[{"type":"text","content":"\n\n\n\nOrefinders Updates Investment Thesis, Provides View on How Recent Gold Price Movements Impacts the Juniors\n\n/* Style Definitions */\nspan.prnews_span\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\na.prnews_a\n{\ncolor:blue;\n}\nli.prnews_li\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\np.prnews_p\n{\nfont-size:0.62em;\nfont-family:\"Arial\";\ncolor:black;\nmargin:0in;\n}\n.prntac{\nTEXT-ALIGN: CENTER\n}\n\n\n\n\n\n\n\nCanada NewsWire\nTORONTO, June 26, 2019\n\n\n\nTORONTO, June 26, 2019 /CNW/ - Orefinders Resources Inc. (\"Orefinders\" or the \"Company\") (TSX.V: ORX) is pleased to provide its updated investment thesis, originally published in September 2018, to include its view on the recent gold price movements, how this impacts the major miners, the gold juniors and how this fits into Orefinders strategy. \nWHAT HAVE WE SEEN THESE LAST 30 DAYS?\nGold price movements in June 2019 look promising as we have exceeded the $1,400 level. This key psychological threshold needs to hold and mature for confidence to be restored from generalist capital so that it flows back into the sector. Should $1,400 hold, it could mark the beginning of a rebirth for gold juniors which Orefinders' strategy has been specifically planned for: to acquire in the downturn and develop in a bull market. \nThus far the gold majors have seen an increase in share price correlating with gold price. The gold price was $1,280/oz 30 days prior to reaching $1,400/oz. This 10% increase in gold price corresponds to a 25% share price increase over the same time period for well known gold equities including Barrick, Kirkland Lake Gold and the GDX. The correlation is evident, but also note the leverage to gold price being 2.5:1. The narrative for investing in gold equities is to get levered exposure to gold price, which has held true this past month.\nGains within the juniors have been comparatively muted, but this is expected as the they will lag gold's movements as a higher gold price does not directly impact a junior's bottom line. Furthermore, greater sector confidence is required for capital to travel up the risk curve.\nWHAT COULD HAPPEN NEXT?\nInitially, generalist capital seeks returns in the perceived lowest risk segment of gold – the majors. As these investors gain confidence and realize returns in g...