{"id":1144745,"date":"2019-10-18T15:31:16","date_gmt":"2019-10-18T20:31:16","guid":{"rendered":"https:\/\/www.mining.com\/?p=1004700"},"modified":"2019-10-18T15:31:16","modified_gmt":"2019-10-18T20:31:16","slug":"doing-due-diligence-what-to-know-before-investing-in-a-mining-junior","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1144745","title":{"rendered":"Doing due diligence: What to know before investing in a mining junior"},"content":{"rendered":"<p>For the past several years one of the biggest challenges<br \/>\nfacing junior mining companies has been raising initial capital. Investors are<br \/>\nwary, and are doing due diligence before injecting funds into projects<br \/>\nspearheaded by junior explorers that are going after mineral deposits disregarded<br \/>\nby the majors, who typically invest in PEA-evaluated, high-grade projects with<br \/>\na nearly guaranteed rate of return. <\/p>\n<div class='d-flex justify-content-center'>\n<div id='div-gpt-ad-1561499308230-0'><script>googletag.cmd.push(function() {googletag.display('div-gpt-ad-1561499308230-0');});<\/script><\/div>\n<\/div>\n<p>But junior explorers going into uncharted territory are on<br \/>\nthe map &#8211; and making a mark, especially in the gold and copper sectors. <\/p>\n<p>Siddharth Rajeev, head VP and Head of Research at Vancouver-based Fundamental Research, the largest independent resource shop in North America focused on junior resources, has covered over 450 companies with a focus on mining.<\/p>\n<figure class=\"wp-block-pullquote alignright\">\n<blockquote>\n<p>Take into consideration the target commodity and the fundamentals of the proposed project, such as location, geology, the economics of extraction and production forecasts<\/p>\n<\/blockquote>\n<\/figure>\n<p>Rajeev said when evaluating mining juniors, they first look<br \/>\nat management teams, their track records, past positions, whether they have any<br \/>\nred flags, and spend a lot of time interviewing executives to get a vision for<br \/>\ntheir companies. <\/p>\n<p>Rajeev said they also take into consideration the target<br \/>\ncommodity and the fundamentals of the proposed project, such as location, geology,<br \/>\nthe economics of extraction and production forecasts. <\/p>\n<p>\u201cWe look at the resource stage or PEA stage our risk analysis also changes, management, then we look at the commodity forecasts and the project then the last thing we look at is the capital structure to find our who owns the company shares, investors involved to see will work in the best interests of the investors. We need to know if they have a decent balance sheet, cash on hand.\u201d<\/p>\n<p>Rajeev said that juniors usually focus on the gold and copper sectors, because traditionally, they are the biggest commodities in terms of exploration spending and also market size. <\/p>\n<p>\u201cCapital is fired up big time and that\u2019s why it doesn\u2019t seem<br \/>\nlike the market is bullish on any particular commodity, especially gold, or copper.<br \/>\nInvestors are extremely scared and skeptical so its very difficult for juniors<br \/>\nto raise money,\u201d he said. &nbsp;<\/p>\n<p>\u201cWhen there is no money it writes off exploration and the<br \/>\nbeauty of this is that in an environment that lasts longer and there is more<br \/>\ncapital, that eventually turns out to be a bull-run after that,\u201d he said. <\/p>\n<p>Rajeev remains positive on the near future for junior<br \/>\nexplorers with a focus on gold. <\/p>\n<p><strong>\u00a0<\/strong>\u201cI think gold projects should be trading at significantly higher valuation because these prices are attractive for large companies out there. I think the market is overly sceptical. I am expecting a better performance by the gold juniors. We do expect a weakness in the US dollar which should impact commodities across the board. So overall, we are expecting an even better performance over the next 12 months,\u201d Rajeev said. <\/p>\n<p>Fundamental Research has authored three courses on<em><a href=\"https:\/\/www.edumine.com\/\"  rel=\"noreferrer noopener\" aria-label=\" Edumine (opens in a new tab)\"> Edumine<\/a><\/em>, a&nbsp;leading mining industry training platform.  <\/p>\n<ul>\n<li>Intro to Evaluation of Junior Mining Companies<\/li>\n<li>How to conduct Due Diligence for juniors in 15 minutes\n<\/li>\n<li>And lastly an Introduction to Forecasting commodity<br \/>\nprices<\/li>\n<\/ul>\n<p> \u201cWe saw a surge in interest in our courses on junior mining evaluation starting this spring,\u201d said Marc Borbas, VP Talent Solutions for <em>Edumine<\/em>. \u201cThe courses from the team at Fundamental Research are a great way for investors to educate themselves on how to evaluate junior mining companies.&#8221;  <\/p>\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link\" href=\"https:\/\/learn.edumine.com\/store\/628004-how-to-conduct-due-diligence-of-junior-mining-companies-in-15-minutes?utm_source=mining.com&amp;utm_medium=article&amp;utm_campaign=EDU-GENERAL&amp;utm_content=For%20evaluating%20juniors%20course\">Click here to view courses. <\/a><\/div><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Junior explorers going into uncharted territory are on the map &#8211; and making a mark, especially in the gold and copper sectors.<\/p>\n","protected":false},"author":47,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[2648,624,2849,369],"tags":[],"_links":{"self":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1144745"}],"collection":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/users\/47"}],"replies":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1144745"}],"version-history":[{"count":3,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1144745\/revisions"}],"predecessor-version":[{"id":1144765,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1144745\/revisions\/1144765"}],"wp:attachment":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1144745"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1144745"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1144745"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}