Companies in the royalty industry finance mines in exchange for precious metals or cash.
If mines have problems financing their project in the traditional way, they can borrow money from licensing and streaming companies. The royalty companies receive a fixed percentage of the revenue generated by the mine. Streaming companies receive metals in physical form. For them, the big advantage is that the investment in precious metal profits is not associated with the operational risk of running a mine. The risks of mining remain with the mine operators. Another advantage, also for the investor, is the diversification, as there are usually agreements with many partners. If one mine yields nothing or only a little, income can still be generated from other mines. And the profit margins are higher with royalty and streaming companies than with conventional gold companies. This is because the streaming company can buy the precious metal at reduced prices, which increases the profit.
Diversification can result from investing in mines at different stages. This can be investments in producing mines or in mines that are only in the development stage. Of course, investing in licensing and streaming companies also brings risks. Since these types of companies require a lot of capital, capital must be raised through stock issues or debt. There may be dilution of ownership for existing shareholders. However, if a successful mine is financed, investors will receive higher returns.
Royalty companies in the gold and silver sector include Empress Royalty - https://www.youtube.com/watch?v=d-ptx2yvyfU -, for example. The fledgling company has built a portfolio of 17 precious metal agreements (in development and production stages). The first revenues from the Sierra Antapite gold mine in Peru have just flowed to Empress Royalty.
A longer established royalty company is Osisko Gold Royalties - https://www.youtube.com/watch?v=VOZAwoLV71s - with more than 150 royalty and precious metal sales in North America.
Current corporate information and press releases from Osisko Gold Royalties (- https://www.resource-capital.ch/en/companies/osisko-gold-royalties-ltd/ -).
In accordance with §34 WpHG I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and thus a possible conflict of interest exists. No guarantee for the translation into English. Only the German version of this news is valid.
Disclaimer: The information provided does not represent any form of recommendation or advice. Express reference is made to the risks in securities trading. No liability can be accepted for any damage arising from the use of this blog. I would like to point out that shares and especially warrant investments are always associated with risk. The total loss of the invested capital cannot be excluded. All information and sources are carefully researched. However, no guarantee is given for the correctness of all contents. Despite the greatest care, I expressly reserve the right to make errors, especially with regard to figures and prices. The information contained herein is taken from sources believed to be reliable, but in no way claims to be accurate or complete. Due to court decisions, the contents of linked external sites are also co-responsible (e.g. Landgericht Hamburg, in the decision of 12.05.1998 - 312 O 85/98), as long as there is no explicit dissociation from them. Despite careful control of the content, I do not assume liability for the content of linked external pages. The respective operators are exclusively responsible for their content. The disclaimer of Swiss Resource Capital AG also applies: https://www.resource-capital.ch/en/disclaimer/
If mines have problems financing their project in the traditional way, they can borrow money from licensing and streaming companies. The royalty companies receive a fixed percentage of the revenue generated by the mine. Streaming companies receive metals in physical form. For them, the big advantage is that the investment in precious metal profits is not associated with the operational risk of running a mine. The risks of mining remain with the mine operators. Another advantage, also for the investor, is the diversification, as there are usually agreements with many partners. If one mine yields nothing or only a little, income can still be generated from other mines. And the profit margins are higher with royalty and streaming companies than with conventional gold companies. This is because the streaming company can buy the precious metal at reduced prices, which increases the profit.
Diversification can result from investing in mines at different stages. This can be investments in producing mines or in mines that are only in the development stage. Of course, investing in licensing and streaming companies also brings risks. Since these types of companies require a lot of capital, capital must be raised through stock issues or debt. There may be dilution of ownership for existing shareholders. However, if a successful mine is financed, investors will receive higher returns.
Royalty companies in the gold and silver sector include Empress Royalty - https://www.youtube.com/watch?v=d-ptx2yvyfU -, for example. The fledgling company has built a portfolio of 17 precious metal agreements (in development and production stages). The first revenues from the Sierra Antapite gold mine in Peru have just flowed to Empress Royalty.
A longer established royalty company is Osisko Gold Royalties - https://www.youtube.com/watch?v=VOZAwoLV71s - with more than 150 royalty and precious metal sales in North America.
Current corporate information and press releases from Osisko Gold Royalties (- https://www.resource-capital.ch/en/companies/osisko-gold-royalties-ltd/ -).
In accordance with §34 WpHG I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and thus a possible conflict of interest exists. No guarantee for the translation into English. Only the German version of this news is valid.
Disclaimer: The information provided does not represent any form of recommendation or advice. Express reference is made to the risks in securities trading. No liability can be accepted for any damage arising from the use of this blog. I would like to point out that shares and especially warrant investments are always associated with risk. The total loss of the invested capital cannot be excluded. All information and sources are carefully researched. However, no guarantee is given for the correctness of all contents. Despite the greatest care, I expressly reserve the right to make errors, especially with regard to figures and prices. The information contained herein is taken from sources believed to be reliable, but in no way claims to be accurate or complete. Due to court decisions, the contents of linked external sites are also co-responsible (e.g. Landgericht Hamburg, in the decision of 12.05.1998 - 312 O 85/98), as long as there is no explicit dissociation from them. Despite careful control of the content, I do not assume liability for the content of linked external pages. The respective operators are exclusively responsible for their content. The disclaimer of Swiss Resource Capital AG also applies: https://www.resource-capital.ch/en/disclaimer/
