1 00:00:10,840 --> 00:00:14,320 Speaker 1: Hello, Welcome to The Australian's Money Puzzle podcast. I'm James Kirby. 2 00:00:14,400 --> 00:00:17,560 Speaker 1: Welcome aboard. Everybody. You know already of course that the 3 00:00:17,560 --> 00:00:22,040 Speaker 1: single best investment mainstream investment last year was gold and 4 00:00:22,120 --> 00:00:24,120 Speaker 1: for all we know, it could be the best investment 5 00:00:24,280 --> 00:00:26,920 Speaker 1: of the decade really if some in the market have 6 00:00:27,040 --> 00:00:29,800 Speaker 1: it right. It went up around sixty percent. That's Bulliant 7 00:00:30,000 --> 00:00:33,640 Speaker 1: just went up around sixty percent in the last twelve months, 8 00:00:33,680 --> 00:00:36,640 Speaker 1: and then gold miners as a group, as a category, 9 00:00:36,680 --> 00:00:40,600 Speaker 1: as a sector roughly tripled. That is, the gold price 10 00:00:40,640 --> 00:00:42,520 Speaker 1: they went up about one hundred and fifty percent, judging 11 00:00:42,560 --> 00:00:44,640 Speaker 1: if we take that number from a from the gold 12 00:00:44,640 --> 00:00:46,320 Speaker 1: mining ETFs. 13 00:00:45,720 --> 00:00:46,360 Speaker 2: That are out there. 14 00:00:46,400 --> 00:00:48,440 Speaker 1: So I think it's a crucial to our listens. I 15 00:00:48,440 --> 00:00:51,440 Speaker 1: think that the fact that we have seen some very 16 00:00:51,520 --> 00:00:55,400 Speaker 1: important people in financial advice saying that investors should have 17 00:00:55,440 --> 00:00:58,720 Speaker 1: an allocation to gold. We have said in the past 18 00:00:58,760 --> 00:01:03,560 Speaker 1: this extraordinary claim from Mike Wilson, the chief investment officer 19 00:01:03,960 --> 00:01:07,640 Speaker 1: at Morgan Stanley, who suggests up to twenty percent should. 20 00:01:07,440 --> 00:01:08,080 Speaker 2: Be held in gold. 21 00:01:08,120 --> 00:01:10,760 Speaker 1: I don't know about that, but you should have gold 22 00:01:10,880 --> 00:01:14,600 Speaker 1: in your portfolio. And some people conservative investors have been 23 00:01:14,600 --> 00:01:18,240 Speaker 1: waiting for a pullback in this red hot rally in gold, 24 00:01:19,040 --> 00:01:21,680 Speaker 1: and it's happened just this last few days. That is, 25 00:01:21,760 --> 00:01:23,600 Speaker 1: I'm speaking to you on a Tuesday, and over the 26 00:01:23,600 --> 00:01:27,880 Speaker 1: weekend gold had its sharpest for for many years, and 27 00:01:27,920 --> 00:01:31,120 Speaker 1: it fell roughly ten percent on the market around the 28 00:01:31,120 --> 00:01:34,479 Speaker 1: world over the weekend silver fell around thirty percent, which 29 00:01:34,520 --> 00:01:37,240 Speaker 1: they tend to be a ratio between those two precious metals. 30 00:01:37,760 --> 00:01:40,880 Speaker 1: So the pullback is here if you've been waiting for it. 31 00:01:41,640 --> 00:01:45,560 Speaker 1: My guest today is right across gold. He's a specialist 32 00:01:45,560 --> 00:01:47,800 Speaker 1: in gold. He runs a gold fund since twenty twenty 33 00:01:47,920 --> 00:01:51,680 Speaker 1: to the r Gonut Goal Fund. He is a fund 34 00:01:51,720 --> 00:01:54,520 Speaker 1: manager and co founder of a fund management group of 35 00:01:54,640 --> 00:01:55,919 Speaker 1: part His name is David Franklin. 36 00:01:56,000 --> 00:01:57,120 Speaker 2: Hi, David, how are you bid? 37 00:01:57,200 --> 00:01:58,560 Speaker 3: James? Thanks for having me on. 38 00:01:59,120 --> 00:02:02,200 Speaker 1: So we're all sort of led to the party. I'm 39 00:02:02,240 --> 00:02:04,240 Speaker 1: sure we're black people who turn up at the betting 40 00:02:04,240 --> 00:02:07,960 Speaker 1: office on Melbourne Copte asking how it all works and 41 00:02:08,000 --> 00:02:10,560 Speaker 1: which horse should we pick. You've been, I mean in 42 00:02:10,639 --> 00:02:13,160 Speaker 1: Paris first of all, and then in gold since twenty 43 00:02:13,240 --> 00:02:17,040 Speaker 1: twenty two, So tell me in your own words what 44 00:02:17,360 --> 00:02:21,600 Speaker 1: you think has happened in the last few months. Where 45 00:02:21,600 --> 00:02:24,920 Speaker 1: we've had a stretch of a rally in the good 46 00:02:24,919 --> 00:02:27,080 Speaker 1: price that we haven't seen since the nineteen eighties. 47 00:02:27,120 --> 00:02:28,520 Speaker 2: What do you think is happening? 48 00:02:29,680 --> 00:02:32,640 Speaker 4: So the big change has been in investment demand, and 49 00:02:32,680 --> 00:02:34,720 Speaker 4: in particularly demand from ETF. 50 00:02:34,880 --> 00:02:37,720 Speaker 3: So in twenty twenty four there was actually. 51 00:02:37,520 --> 00:02:41,720 Speaker 4: An outflow from ETFs of about about three tons. In 52 00:02:42,200 --> 00:02:45,560 Speaker 4: twenty twenty five there was an inflow of eight hundred 53 00:02:45,600 --> 00:02:49,320 Speaker 4: and one tons, so a massive turnaround, and I think 54 00:02:49,400 --> 00:02:52,680 Speaker 4: that's one where people are saying, look, the world's uncertain, 55 00:02:52,760 --> 00:02:56,119 Speaker 4: I want to hold physical gold through through an ETF. 56 00:02:56,360 --> 00:02:59,320 Speaker 4: But I also think what atfs really reflect to a 57 00:02:59,360 --> 00:03:01,120 Speaker 4: large extent is fear and greed. 58 00:03:01,240 --> 00:03:01,440 Speaker 3: Right. 59 00:03:01,480 --> 00:03:03,640 Speaker 4: So the last time it was a big inflows into 60 00:03:03,680 --> 00:03:06,720 Speaker 4: gold was during COVID, where that was really what i'd 61 00:03:06,800 --> 00:03:08,880 Speaker 4: call the fear trade, where people are trying, I'm worried 62 00:03:08,919 --> 00:03:10,680 Speaker 4: what's having in the world here, I'm going to hold 63 00:03:10,680 --> 00:03:12,919 Speaker 4: some gold. I think there's still a bit of that 64 00:03:13,120 --> 00:03:16,800 Speaker 4: just given the geopolitical situations, but I think more recently 65 00:03:17,000 --> 00:03:20,520 Speaker 4: it's been driven by greed, right, as people saying gold 66 00:03:20,600 --> 00:03:22,720 Speaker 4: is where I want to be, Gold is where everyone 67 00:03:22,720 --> 00:03:25,000 Speaker 4: else is making money, and I'm piling in and ETFs 68 00:03:25,040 --> 00:03:26,800 Speaker 4: are an easy way to do it, and I think 69 00:03:27,000 --> 00:03:30,000 Speaker 4: the issue with that ETF market is it can be 70 00:03:30,000 --> 00:03:33,440 Speaker 4: pretty fickle. So after COVID, the money then flowed out 71 00:03:33,480 --> 00:03:35,640 Speaker 4: for the next few years and it's only really in 72 00:03:35,720 --> 00:03:37,280 Speaker 4: the last six months and it started to. 73 00:03:37,200 --> 00:03:39,640 Speaker 3: Flow back in and it's flowed in a big way. 74 00:03:39,680 --> 00:03:42,200 Speaker 4: And I think that's all well and good, but it 75 00:03:42,240 --> 00:03:44,960 Speaker 4: can change, and it can change quickly. And I think 76 00:03:45,000 --> 00:03:47,119 Speaker 4: that's what we've seen over the last month is there's 77 00:03:47,160 --> 00:03:49,920 Speaker 4: been a turning point and people have said, Okay, I'm 78 00:03:49,920 --> 00:03:51,400 Speaker 4: going to cash in now, and a bit of fear 79 00:03:51,480 --> 00:03:52,480 Speaker 4: kicked in and they're out. 80 00:03:53,480 --> 00:03:56,200 Speaker 1: So this value, at least this is a selloff that's 81 00:03:56,320 --> 00:03:58,840 Speaker 1: happening might disturb people who are new to the game. 82 00:03:59,800 --> 00:04:01,840 Speaker 1: Can you tell us what you think of the setoff? 83 00:04:02,320 --> 00:04:03,720 Speaker 1: Just tell me what you think about it. Do you 84 00:04:03,720 --> 00:04:06,880 Speaker 1: think it's serious? Do you think it is a change 85 00:04:06,880 --> 00:04:08,480 Speaker 1: in direction for the gold price? Do you think it 86 00:04:08,480 --> 00:04:09,040 Speaker 1: will recover? 87 00:04:09,640 --> 00:04:09,839 Speaker 3: Well? 88 00:04:09,880 --> 00:04:14,120 Speaker 4: I think the tailwinds for gold are still in place, right, 89 00:04:14,240 --> 00:04:17,360 Speaker 4: So you look at what's happening globally, you go there's 90 00:04:17,360 --> 00:04:21,440 Speaker 4: really a changing world order, and in particular the US's 91 00:04:21,560 --> 00:04:24,040 Speaker 4: role in that. I think they've taken a view that 92 00:04:24,360 --> 00:04:26,000 Speaker 4: we're a superpower and we're now going. 93 00:04:25,880 --> 00:04:27,920 Speaker 3: To act like one. Right, We're not necessarily going to 94 00:04:27,960 --> 00:04:30,120 Speaker 3: be the protector of the planet. We're going to be 95 00:04:30,279 --> 00:04:32,840 Speaker 3: putting the US first. As part of that. 96 00:04:33,080 --> 00:04:35,919 Speaker 4: Not Eeron now wants to hold US assets and so 97 00:04:35,960 --> 00:04:38,480 Speaker 4: they're looking for alternative. So gold really is a store 98 00:04:38,520 --> 00:04:41,520 Speaker 4: of value, which has been for thousands of years, is 99 00:04:41,560 --> 00:04:42,840 Speaker 4: really coming back to the foe. 100 00:04:43,240 --> 00:04:45,160 Speaker 3: You've got groups like Russia. 101 00:04:45,760 --> 00:04:48,799 Speaker 4: You know, when Russia invade Ukraine and the US froze 102 00:04:48,839 --> 00:04:51,400 Speaker 4: a lot of their assets are really highlighted that holding 103 00:04:51,520 --> 00:04:52,440 Speaker 4: US assets is. 104 00:04:54,320 --> 00:04:54,680 Speaker 3: A risk. 105 00:04:55,080 --> 00:04:56,760 Speaker 4: And since then you've seen a lot of central bank 106 00:04:56,800 --> 00:05:01,039 Speaker 4: buying from China, etc. So I think the tailwinds for 107 00:05:01,120 --> 00:05:04,240 Speaker 4: gold are there and will continue. What I saw is 108 00:05:04,240 --> 00:05:06,920 Speaker 4: it just got a bit overinflated at overhead and you've 109 00:05:06,920 --> 00:05:09,520 Speaker 4: seen a pullback. But I think you'd expect that gold 110 00:05:09,560 --> 00:05:13,080 Speaker 4: will continue to be sought and it should be part 111 00:05:13,120 --> 00:05:14,720 Speaker 4: of people's portfolios. 112 00:05:15,480 --> 00:05:17,799 Speaker 1: I know this is difficult, but from terms of bullion, 113 00:05:18,360 --> 00:05:20,520 Speaker 1: so the big number was five thousand, that would it 114 00:05:20,560 --> 00:05:22,560 Speaker 1: get to five thousands, and of course it got to 115 00:05:22,600 --> 00:05:25,599 Speaker 1: five thousand frizte easily and it loaded above that number. 116 00:05:26,040 --> 00:05:28,279 Speaker 1: A lot of the big banks of global investment banks 117 00:05:28,320 --> 00:05:30,480 Speaker 1: are pitching that it will get to five five five 118 00:05:30,640 --> 00:05:34,039 Speaker 1: six this year. It's currently has dropped fair bit. That 119 00:05:34,040 --> 00:05:36,800 Speaker 1: pullback is real and stand around four to seven, that 120 00:05:36,920 --> 00:05:39,480 Speaker 1: is four thousand and seven of the US for gold bullion. 121 00:05:40,760 --> 00:05:43,359 Speaker 1: What is the point that you think would be a 122 00:05:43,480 --> 00:05:44,240 Speaker 1: floor as such? 123 00:05:44,600 --> 00:05:44,680 Speaker 3: Is? 124 00:05:44,880 --> 00:05:46,000 Speaker 2: Do you have a number in mind? 125 00:05:46,920 --> 00:05:48,520 Speaker 3: Yeah? Look, it's always difficult. 126 00:05:48,640 --> 00:05:50,640 Speaker 4: So, I mean I spent a lot of time looking 127 00:05:50,640 --> 00:05:55,200 Speaker 4: at commodities and markets and looking at forecasts, and the 128 00:05:55,240 --> 00:05:57,719 Speaker 4: one thing I'm sure about is most of the forecast 129 00:05:57,760 --> 00:06:00,880 Speaker 4: that you read about are wrong, right, So the view 130 00:06:00,960 --> 00:06:03,680 Speaker 4: I try to take is rather than predict, I kind 131 00:06:03,680 --> 00:06:06,719 Speaker 4: of observe and then sort of react. So, you know, 132 00:06:06,760 --> 00:06:08,840 Speaker 4: I would have thought gold could pull back a little bit, 133 00:06:08,960 --> 00:06:11,640 Speaker 4: but as I said, the catalysts there for gold remain 134 00:06:11,720 --> 00:06:13,800 Speaker 4: in place. So I think what we'll probably see is 135 00:06:13,800 --> 00:06:16,360 Speaker 4: some kind of stabilization. You so could see come back 136 00:06:16,400 --> 00:06:18,480 Speaker 4: a little bit more. But in general, I think. 137 00:06:18,400 --> 00:06:20,039 Speaker 3: In twelve months time it's going to be higher. 138 00:06:20,080 --> 00:06:21,839 Speaker 4: Ideally it's going to be around sort of the five 139 00:06:21,880 --> 00:06:25,279 Speaker 4: thousand dollars announce you wes, but you know they're not 140 00:06:25,360 --> 00:06:26,960 Speaker 4: lifetime guarantees, right, So. 141 00:06:27,800 --> 00:06:30,800 Speaker 1: No, of course understand and then bank most forecasts are 142 00:06:30,839 --> 00:06:33,280 Speaker 1: hired the much you've said out there at this point 143 00:06:33,520 --> 00:06:36,000 Speaker 1: from credible banks, I mean, from our own CBA and 144 00:06:36,040 --> 00:06:38,720 Speaker 1: from gpmorgan et cetera. Okay, no one knows where it's 145 00:06:38,720 --> 00:06:40,520 Speaker 1: going to go, but you're you'd obviously be confident that 146 00:06:40,520 --> 00:06:43,880 Speaker 1: it's going to go higher running a fond. Now I 147 00:06:43,960 --> 00:06:47,520 Speaker 1: want to ask you the points you made about gold 148 00:06:47,760 --> 00:06:52,880 Speaker 1: and the reasons why it has strong structural drivers and 149 00:06:52,960 --> 00:06:55,800 Speaker 1: there is a consensus that it will move higher from here. 150 00:06:56,720 --> 00:06:57,960 Speaker 1: We don't know if it will be as good next 151 00:06:58,000 --> 00:07:00,880 Speaker 1: to this twenty six is twenty five, but it has 152 00:07:00,920 --> 00:07:03,640 Speaker 1: a lot going forward as an investment option. So let's 153 00:07:03,680 --> 00:07:07,320 Speaker 1: assume the listener says, Okay, I am convinced of that, 154 00:07:07,520 --> 00:07:09,000 Speaker 1: and in fact, I missed the first part of the 155 00:07:09,000 --> 00:07:11,960 Speaker 1: gold rally, and I'm interested in getting in. Now you 156 00:07:12,080 --> 00:07:16,280 Speaker 1: are in the business of actually choosing gold miners, so 157 00:07:16,320 --> 00:07:19,360 Speaker 1: you're another step down the road if you like it. 158 00:07:19,360 --> 00:07:21,360 Speaker 1: It's not a gold fund per se that it's not 159 00:07:21,400 --> 00:07:25,280 Speaker 1: a bulliant fund. It is a gold miner's fund, and 160 00:07:25,320 --> 00:07:28,920 Speaker 1: it's an active fund, so you are actively choosing the 161 00:07:28,960 --> 00:07:32,760 Speaker 1: ones you think are best. So in the last year, 162 00:07:33,080 --> 00:07:36,200 Speaker 1: gold went up about fifty six percent, And as I 163 00:07:36,240 --> 00:07:39,120 Speaker 1: said in Bulliant ETFs, did you beat the ETFs? Did 164 00:07:39,160 --> 00:07:42,200 Speaker 1: your fund as an active managed fund beat the ETFs 165 00:07:42,280 --> 00:07:44,360 Speaker 1: that were buying gold miners. 166 00:07:44,720 --> 00:07:48,280 Speaker 4: So we're about in line with the junior gold index 167 00:07:48,320 --> 00:07:51,640 Speaker 4: at GDXJ we were beaten the producer gold index. 168 00:07:51,880 --> 00:07:54,720 Speaker 3: But you know the fund was up approximately. 169 00:07:54,080 --> 00:07:57,240 Speaker 4: One hundred and fifty percent in the last twelve months. 170 00:07:58,000 --> 00:08:01,000 Speaker 1: Right, Okay, just tell us what your proposal is to 171 00:08:01,040 --> 00:08:02,600 Speaker 1: the investor who says, look, I'm just going to buy 172 00:08:02,640 --> 00:08:04,120 Speaker 1: an ETF, I'm just going to buy it. I'm going 173 00:08:04,120 --> 00:08:05,680 Speaker 1: to buy gold bullion and I'm also going to buy 174 00:08:05,680 --> 00:08:10,080 Speaker 1: gold miners ETF and I'm going to take the gamble 175 00:08:10,120 --> 00:08:15,280 Speaker 1: basically that I might miss some spectacular returns. So what 176 00:08:15,560 --> 00:08:18,440 Speaker 1: do you offer to the listener who's thinking like that. 177 00:08:19,560 --> 00:08:23,160 Speaker 4: Yeah, Look, the problem with atfs is they're not the 178 00:08:23,200 --> 00:08:26,080 Speaker 4: portfolio is not value driven. So you can have a 179 00:08:26,200 --> 00:08:28,800 Speaker 4: very strongly year like you've had in the past year, 180 00:08:29,240 --> 00:08:32,000 Speaker 4: and money is flowing in based on the market cap 181 00:08:32,040 --> 00:08:35,160 Speaker 4: of companies rather than on the value proposition of those companies. 182 00:08:35,480 --> 00:08:38,560 Speaker 4: So what we would like to suggest is that you know, 183 00:08:38,640 --> 00:08:42,040 Speaker 4: active management over time will deliver better returns if you're 184 00:08:42,240 --> 00:08:46,120 Speaker 4: you know, if you're a quality manager, because sift through 185 00:08:46,240 --> 00:08:48,520 Speaker 4: the value. You're not just buying a stock based on 186 00:08:48,520 --> 00:08:51,559 Speaker 4: its market cap, you're buying it on its value. 187 00:08:51,120 --> 00:08:54,080 Speaker 3: So that's really the proposition for a golfer. 188 00:08:54,920 --> 00:08:57,480 Speaker 4: So typically we'll own between fifteen and twenty stocks, so 189 00:08:57,480 --> 00:09:00,000 Speaker 4: we're very selective in sort of the quality. 190 00:09:00,480 --> 00:09:02,920 Speaker 1: So digen or twenty stocks is tight, right, So I 191 00:09:03,040 --> 00:09:05,320 Speaker 1: buy anity F it's got hundreds and hundreds of it. 192 00:09:05,320 --> 00:09:08,120 Speaker 1: It's got your highs of rubbish and it's obviously pis 193 00:09:08,120 --> 00:09:10,319 Speaker 1: of good stocks, and you're helping that. Basically the rubbish 194 00:09:10,320 --> 00:09:13,880 Speaker 1: gets drowned and the overall momentum. But in a more 195 00:09:13,960 --> 00:09:20,240 Speaker 1: selective active operation like yours, you are picking gold miners 196 00:09:20,280 --> 00:09:23,280 Speaker 1: ten to twenty. You said, that's fairly high conviction. That's 197 00:09:23,280 --> 00:09:26,120 Speaker 1: a fairly small pond. Why do you keep it so tight? 198 00:09:27,559 --> 00:09:30,959 Speaker 4: Well, we just you know, we focus on quality. So 199 00:09:31,800 --> 00:09:35,800 Speaker 4: what we're looking for is companies that have good production growth, 200 00:09:35,920 --> 00:09:39,400 Speaker 4: low op X, low cap X, generally high grade, a 201 00:09:39,480 --> 00:09:42,880 Speaker 4: real focus on free cash generation is long mind life. 202 00:09:42,920 --> 00:09:45,040 Speaker 3: So you know the thing about resource. 203 00:09:44,760 --> 00:09:48,800 Speaker 4: And gold companies is it's an asset that is in 204 00:09:48,880 --> 00:09:52,120 Speaker 4: decline from the moment you start to produce. So what 205 00:09:52,160 --> 00:09:53,800 Speaker 4: you want is to start with a big old body 206 00:09:53,920 --> 00:09:54,920 Speaker 4: so that you can you. 207 00:09:54,880 --> 00:09:55,720 Speaker 3: Have a mind life. 208 00:09:55,800 --> 00:09:58,120 Speaker 4: And then it comes down to the more general factors, 209 00:09:58,120 --> 00:09:59,800 Speaker 4: so you want to make sure the strong balance sheet, 210 00:09:59,800 --> 00:10:02,600 Speaker 4: good management, and location is also really important. 211 00:10:02,679 --> 00:10:03,880 Speaker 3: So what we're. 212 00:10:03,720 --> 00:10:08,520 Speaker 4: Looking for is, at its core is really like any investment, 213 00:10:08,559 --> 00:10:10,480 Speaker 4: we want to see the free cash flow than those 214 00:10:10,480 --> 00:10:12,920 Speaker 4: companies generate. And what you're seeing with the gold price 215 00:10:12,960 --> 00:10:15,720 Speaker 4: around five thousand all an ounce is gold companies aren't 216 00:10:15,760 --> 00:10:17,160 Speaker 4: generating very good. 217 00:10:17,040 --> 00:10:20,200 Speaker 1: Cash because it's very profitable because their costs are more 218 00:10:20,240 --> 00:10:23,280 Speaker 1: or less set, but the price of the commodity is rising. 219 00:10:23,320 --> 00:10:26,400 Speaker 2: Tell me. The theory, of course, is that when you. 220 00:10:26,400 --> 00:10:29,400 Speaker 1: Have a gold rally or a gold rush as we're 221 00:10:29,440 --> 00:10:33,800 Speaker 1: having now, bullion moves first and then there's the miners 222 00:10:33,800 --> 00:10:37,079 Speaker 1: come after. So on that basis, the miner should have 223 00:10:37,120 --> 00:10:40,160 Speaker 1: a better year than the bullion itself, which was the 224 00:10:40,200 --> 00:10:43,400 Speaker 1: case last year. I'm assuming you backed that because you've 225 00:10:43,400 --> 00:10:45,760 Speaker 1: got a gold fund, but could you explain that particular 226 00:10:45,800 --> 00:10:47,160 Speaker 1: contention to listeners. 227 00:10:47,800 --> 00:10:49,840 Speaker 4: Yeah, well, it's actually very true if you look at 228 00:10:49,880 --> 00:10:52,800 Speaker 4: what's so Obviously, we track sort of the goal price 229 00:10:52,920 --> 00:10:55,200 Speaker 4: versus gold equities, and if you look at the last 230 00:10:55,240 --> 00:10:58,080 Speaker 4: two years, for most of that two year period, the 231 00:10:58,120 --> 00:11:01,720 Speaker 4: gold price actually outperformed old equity and it takes a 232 00:11:01,720 --> 00:11:04,760 Speaker 4: bit of time for the investment markets to kind of 233 00:11:04,800 --> 00:11:06,840 Speaker 4: catch up. And then what you've seen in the last 234 00:11:06,920 --> 00:11:11,520 Speaker 4: six months, in particular, gold equities dramatically outperformed, which is 235 00:11:11,720 --> 00:11:15,920 Speaker 4: expected because, as you're saying, you know, costs of producing 236 00:11:15,960 --> 00:11:18,560 Speaker 4: gold are relatively fixed. They do tend to go up 237 00:11:18,559 --> 00:11:20,280 Speaker 4: as gold price goes up, and they don't go up 238 00:11:20,280 --> 00:11:22,920 Speaker 4: at the same rate as gold. So your margins are 239 00:11:22,960 --> 00:11:26,280 Speaker 4: expanding and therefore your profitability is increasing at a faster 240 00:11:26,440 --> 00:11:27,720 Speaker 4: rate than the price of goals. 241 00:11:28,640 --> 00:11:31,320 Speaker 1: And what you're saying is that actually only happened but 242 00:11:31,760 --> 00:11:32,240 Speaker 1: last year. 243 00:11:32,600 --> 00:11:34,840 Speaker 3: Yeah, yeah, it's really in the last six months. 244 00:11:35,160 --> 00:11:37,960 Speaker 1: Okay, this is just starting to happen. Keep that in mind, folks. 245 00:11:37,960 --> 00:11:48,040 Speaker 1: We'll take a break. We'll be back in a month. Hello, 246 00:11:48,120 --> 00:11:50,880 Speaker 1: Welcome back to the Australian's Money Positive podcast. James can't 247 00:11:50,880 --> 00:11:54,560 Speaker 1: be here talking to David Franklin of the Argornaut Gold Fund. 248 00:11:54,640 --> 00:11:59,440 Speaker 1: It's a fund which specializes an active managed fund which 249 00:11:59,679 --> 00:12:03,080 Speaker 1: buy is ghost stocks, and obviously the contention is that 250 00:12:03,120 --> 00:12:04,840 Speaker 1: they will pick the best ones and they will beat 251 00:12:04,840 --> 00:12:09,080 Speaker 1: the index in the long term. David, these ghostocks you buy. 252 00:12:09,160 --> 00:12:11,520 Speaker 1: One of the things comparing and contrasting we're talking about 253 00:12:11,520 --> 00:12:13,880 Speaker 1: the ETF. Does ETF tend to be global that you 254 00:12:13,880 --> 00:12:16,360 Speaker 1: can buy here rather than so I'm guessing that your 255 00:12:16,400 --> 00:12:19,600 Speaker 1: concentration is on funded on gold miners that you actually know, 256 00:12:19,679 --> 00:12:22,320 Speaker 1: you know the numbers, you actually know the people behind 257 00:12:22,360 --> 00:12:25,040 Speaker 1: those companies. Is that part of what you do that 258 00:12:25,080 --> 00:12:29,520 Speaker 1: you actually Yeah, the industry would have lots of characters 259 00:12:29,520 --> 00:12:31,480 Speaker 1: that have been through a few cycles, and there's people 260 00:12:31,520 --> 00:12:34,280 Speaker 1: to avoid and there's people to join. 261 00:12:34,800 --> 00:12:37,079 Speaker 2: Is that part of your rationale and picking stocks? 262 00:12:37,760 --> 00:12:38,840 Speaker 3: Yeah, exactly. 263 00:12:39,240 --> 00:12:42,040 Speaker 4: The fund can invest globally, so typically we have a 264 00:12:42,080 --> 00:12:45,520 Speaker 4: mix of international stocks and also domestic stocks, but the 265 00:12:45,559 --> 00:12:49,319 Speaker 4: portfolio is weighted towards Australian based gold producers. 266 00:12:49,320 --> 00:12:50,600 Speaker 3: And the positive, as you're kind of. 267 00:12:50,559 --> 00:12:54,800 Speaker 4: Alluding to, is Australia has has a big goal sector. 268 00:12:55,000 --> 00:12:58,240 Speaker 4: It's a big global gold producer and there's a big 269 00:12:58,360 --> 00:13:01,199 Speaker 4: universe of gold stocks and it makes it easier and 270 00:13:01,400 --> 00:13:04,360 Speaker 4: you know, often when you're investing in resources and gold 271 00:13:04,360 --> 00:13:07,920 Speaker 4: in particular, where that project is located is really important. 272 00:13:08,160 --> 00:13:11,200 Speaker 4: And the positive is Australia is a very good place 273 00:13:11,240 --> 00:13:14,760 Speaker 4: to invest. Equally, Western Australia are very pro mining, the 274 00:13:14,840 --> 00:13:18,720 Speaker 4: approvals processes that are relatively good, the infrastructure is very good. 275 00:13:18,800 --> 00:13:21,079 Speaker 4: So you know, when you're investing in gold, you want 276 00:13:21,120 --> 00:13:24,000 Speaker 4: to mitigate risk as much as you can. And by 277 00:13:24,040 --> 00:13:26,720 Speaker 4: investing in a project based in Western Australia, for example, 278 00:13:26,960 --> 00:13:29,280 Speaker 4: you're eliminating a lot of potential risks that you might 279 00:13:29,320 --> 00:13:31,120 Speaker 4: get if you go to West Africa or parts of 280 00:13:31,160 --> 00:13:35,120 Speaker 4: South America. 281 00:13:33,400 --> 00:13:36,600 Speaker 1: Eliminating the regulatory risk as you see. Okay, one of 282 00:13:36,600 --> 00:13:39,079 Speaker 1: the things I thought we were talking earlier was fascinating. 283 00:13:39,200 --> 00:13:41,720 Speaker 1: I assumed two things that the gold sector they would 284 00:13:41,720 --> 00:13:44,240 Speaker 1: all run off and start raising money, and that'd be 285 00:13:44,280 --> 00:13:46,559 Speaker 1: a lot of leverage through that sector. And you were 286 00:13:46,559 --> 00:13:49,679 Speaker 1: saying not quite, maybe not yet. But what you were 287 00:13:49,679 --> 00:13:52,120 Speaker 1: telling me, which I didn't know, was there are many 288 00:13:52,120 --> 00:13:55,160 Speaker 1: of them doing so well. They have a lot of cash, 289 00:13:55,360 --> 00:13:57,319 Speaker 1: which that sounds good at best value, but there's a 290 00:13:57,400 --> 00:13:58,760 Speaker 1: point where you don't want to have too much cash 291 00:13:58,800 --> 00:14:01,920 Speaker 1: because it'll drag back your return. That's a real danger, now, 292 00:14:01,960 --> 00:14:03,520 Speaker 1: is it. With many of the best jocks. 293 00:14:04,760 --> 00:14:05,839 Speaker 3: Well, I think you're right. 294 00:14:05,960 --> 00:14:07,679 Speaker 4: I mean, you know, we sort of just if you 295 00:14:07,720 --> 00:14:10,960 Speaker 4: look at a peer group of say the thirteen or so, 296 00:14:11,600 --> 00:14:16,040 Speaker 4: you know, leading Australian based producers and probably ignoring the 297 00:14:16,080 --> 00:14:18,760 Speaker 4: bigger ones Evolution and all the star but the group 298 00:14:18,800 --> 00:14:22,720 Speaker 4: below that thirteen companies net cash is about seven and 299 00:14:22,720 --> 00:14:25,120 Speaker 4: a half billion dollars and most of that has been 300 00:14:25,160 --> 00:14:28,200 Speaker 4: generated in the last couple of years, so it's it's enormous. 301 00:14:28,240 --> 00:14:31,480 Speaker 4: It just shows the benefit of high goal prices, realtive 302 00:14:31,480 --> 00:14:32,600 Speaker 4: fixed costs. 303 00:14:32,280 --> 00:14:33,880 Speaker 3: And you're generating a lot of cash. 304 00:14:33,920 --> 00:14:38,000 Speaker 4: Now that's good and bad, right, because the question is 305 00:14:38,520 --> 00:14:40,920 Speaker 4: what do you do with all that cash? And certainly 306 00:14:40,920 --> 00:14:43,440 Speaker 4: the companies that we would focus on and really like 307 00:14:43,600 --> 00:14:47,760 Speaker 4: are companies like Genesis and Capricorn and great Land and 308 00:14:47,880 --> 00:14:51,640 Speaker 4: Romilius where they've got substantial amounts of cash, but they've 309 00:14:51,640 --> 00:14:55,480 Speaker 4: got very clear growth program and they're developing projects and 310 00:14:55,520 --> 00:14:58,240 Speaker 4: building out their operations, so you can kind of see, well, 311 00:14:58,240 --> 00:14:59,280 Speaker 4: they're growing cash. 312 00:14:59,000 --> 00:15:01,560 Speaker 3: But they've got a good place spend it. Then there's 313 00:15:01,640 --> 00:15:04,480 Speaker 3: companies which have a lot of cash, and Regis is 314 00:15:04,480 --> 00:15:05,560 Speaker 3: probably a good example. 315 00:15:05,720 --> 00:15:08,600 Speaker 4: They've got a lot of cash, good core business their 316 00:15:08,640 --> 00:15:11,080 Speaker 4: mind life is starting to run out and they need 317 00:15:11,080 --> 00:15:13,440 Speaker 4: to do something. So the question is are they going 318 00:15:13,480 --> 00:15:15,840 Speaker 4: to buy something? And in this kind of environment, it's 319 00:15:15,880 --> 00:15:18,360 Speaker 4: a realty difficult time to buy something at values. 320 00:15:18,520 --> 00:15:19,240 Speaker 3: So I wait and see. 321 00:15:19,280 --> 00:15:21,720 Speaker 4: They do have development project that's held up by some 322 00:15:21,800 --> 00:15:24,440 Speaker 4: regulatory approvals in New South Wales. It might come through, 323 00:15:24,640 --> 00:15:27,200 Speaker 4: but that would be a concern. And so then you've 324 00:15:27,200 --> 00:15:29,440 Speaker 4: got the bulk of other companies. What are they going 325 00:15:29,520 --> 00:15:31,560 Speaker 4: to do with their cash if they don't have a 326 00:15:31,600 --> 00:15:34,840 Speaker 4: meaningful project to spend the money on. And so you'd 327 00:15:34,880 --> 00:15:37,800 Speaker 4: like to think maybe dividends or share buybacks. But I 328 00:15:37,840 --> 00:15:40,360 Speaker 4: think what you'd suggest is that we're probably going to 329 00:15:40,440 --> 00:15:44,280 Speaker 4: enter a period of increased mergers and acquisitions where people 330 00:15:44,440 --> 00:15:47,160 Speaker 4: are using their balance sheets to grow. 331 00:15:48,240 --> 00:15:50,040 Speaker 2: Rather than giving us special dividends. 332 00:15:50,400 --> 00:15:51,880 Speaker 3: Yeah, hopefully it's a bit of a mix. 333 00:15:51,960 --> 00:15:54,040 Speaker 4: I think some will do it, But the gold sector 334 00:15:54,080 --> 00:15:57,520 Speaker 4: and the resources sector in particular, doesn't have a great 335 00:15:57,560 --> 00:15:59,000 Speaker 4: record of returning capital. 336 00:16:00,840 --> 00:16:02,480 Speaker 1: It's funny because we were saying, I was going to 337 00:16:02,480 --> 00:16:04,320 Speaker 1: say one of the advantages of having a gold stock 338 00:16:04,400 --> 00:16:06,520 Speaker 1: over billion is that bullion pays no income, and the 339 00:16:06,520 --> 00:16:09,960 Speaker 1: gold stocks can. But dividend is not important really in 340 00:16:10,040 --> 00:16:10,880 Speaker 1: your fond is it. 341 00:16:12,200 --> 00:16:14,000 Speaker 3: We don't see it as a key driver. 342 00:16:14,120 --> 00:16:16,400 Speaker 4: I mean, we would like to see become more of 343 00:16:16,440 --> 00:16:19,320 Speaker 4: a more of an issue in that it's an issue 344 00:16:19,360 --> 00:16:22,400 Speaker 4: that often doesn't face the gold producers, right. I think 345 00:16:22,680 --> 00:16:25,880 Speaker 4: you know, to put it in context, that the margins 346 00:16:25,880 --> 00:16:29,520 Speaker 4: of gold producers are making now is unusually high, and 347 00:16:29,560 --> 00:16:32,280 Speaker 4: so the cash builder is unusually high, and so it's 348 00:16:32,280 --> 00:16:34,640 Speaker 4: a challenge that they probably haven't had to deal with 349 00:16:34,680 --> 00:16:36,840 Speaker 4: in having served with cash and what do we do 350 00:16:36,920 --> 00:16:37,160 Speaker 4: with it? 351 00:16:37,280 --> 00:16:39,160 Speaker 1: A nice problem to have. We're going to talk in 352 00:16:39,200 --> 00:16:41,720 Speaker 1: a moment about actual stocks and a couple of stocks 353 00:16:41,760 --> 00:16:44,160 Speaker 1: in particular. I'd like to just drow David on. We'll 354 00:16:44,200 --> 00:16:45,520 Speaker 1: do that after the break. I want to ask you 355 00:16:45,560 --> 00:16:49,200 Speaker 1: one question before the break, which I think is I 356 00:16:49,200 --> 00:16:52,040 Speaker 1: haven't got an answer yet from anyone. The whole gold rally, 357 00:16:52,120 --> 00:16:56,880 Speaker 1: right is premised on the basis that gold is an 358 00:16:56,960 --> 00:17:02,640 Speaker 1: asset that investors seek times of uncertainty, and the theory 359 00:17:02,680 --> 00:17:06,239 Speaker 1: being that gold goes up when stocks go down. But 360 00:17:06,400 --> 00:17:09,000 Speaker 1: this there's a distinction in this gold rally to other 361 00:17:09,080 --> 00:17:13,400 Speaker 1: rallies of great rallies off sa the eighties to prior to. 362 00:17:13,320 --> 00:17:15,640 Speaker 2: Two o seven there's a distinction. 363 00:17:16,040 --> 00:17:20,560 Speaker 1: It's that we're seeing gold go up and global staff 364 00:17:20,600 --> 00:17:23,640 Speaker 1: prices go up at the same time. And what does 365 00:17:23,640 --> 00:17:25,600 Speaker 1: that mean if we had a share market for what 366 00:17:25,640 --> 00:17:29,640 Speaker 1: do you think would happen to gold sector? 367 00:17:31,359 --> 00:17:35,200 Speaker 3: Yeah, look, so my experience is what tends to happen. 368 00:17:35,280 --> 00:17:37,920 Speaker 4: So if you think about some of the big market events, 369 00:17:38,080 --> 00:17:42,080 Speaker 4: you know, GFC, COVID and Trump in April when he 370 00:17:42,119 --> 00:17:45,800 Speaker 4: announced the tariffs, market fell, and typically what will happen 371 00:17:45,960 --> 00:17:49,440 Speaker 4: is gold price will fall with the market, but it 372 00:17:49,480 --> 00:17:52,280 Speaker 4: doesn't stay down long and then it rebound and then 373 00:17:52,280 --> 00:17:56,399 Speaker 4: our performs. The dot com boom of around two thousand 374 00:17:56,480 --> 00:17:59,000 Speaker 4: was a bit different, where the tech stocks fell, but 375 00:17:59,119 --> 00:18:03,600 Speaker 4: gold went up and immediately. So I think it's very situational. 376 00:18:03,760 --> 00:18:06,200 Speaker 4: A lot of reasons to suggest that, you know, like 377 00:18:06,560 --> 00:18:09,440 Speaker 4: gold went up recently in the last few years when 378 00:18:09,480 --> 00:18:12,360 Speaker 4: interest rates were going up, right, which is also very unusual. 379 00:18:12,440 --> 00:18:16,240 Speaker 4: So I think with gold there's always very situational effect. 380 00:18:16,720 --> 00:18:18,639 Speaker 4: And you know, as we alluded to it before, I 381 00:18:18,640 --> 00:18:21,840 Speaker 4: think that the amount of investment demand in gold at 382 00:18:21,880 --> 00:18:24,080 Speaker 4: the moment, and even the central bank buying, which has 383 00:18:24,119 --> 00:18:27,840 Speaker 4: been a cornerstone over recent times, just means that you 384 00:18:27,880 --> 00:18:29,439 Speaker 4: know the situation is. 385 00:18:29,720 --> 00:18:30,399 Speaker 3: A little different. 386 00:18:30,800 --> 00:18:31,200 Speaker 2: Very good. 387 00:18:31,280 --> 00:18:32,879 Speaker 1: We'll take a break, folks and we'll talk about a 388 00:18:32,920 --> 00:18:34,200 Speaker 1: couple of individual gold stops. 389 00:18:34,200 --> 00:18:34,800 Speaker 2: Back in a moment. 390 00:18:41,280 --> 00:18:44,160 Speaker 1: Hello, Welcome back to the Australian's Money Puzzitive podcast. James 391 00:18:44,200 --> 00:18:46,480 Speaker 1: can't be here talking to David Franklin of the arg 392 00:18:46,560 --> 00:18:49,400 Speaker 1: Ornaut Gold Fund. Thank you for coming on the show. 393 00:18:49,440 --> 00:18:51,280 Speaker 1: And that's quite clear that you do. The first thing 394 00:18:51,320 --> 00:18:55,639 Speaker 1: I want to ask you is the sale of New Crest. 395 00:18:55,840 --> 00:18:58,760 Speaker 1: It would seem to me that was an absolute steal. 396 00:19:00,160 --> 00:19:01,000 Speaker 2: A few years ago. 397 00:19:01,880 --> 00:19:06,920 Speaker 4: Yeah, I think it's inarguable it was a steel It's interesting, right, 398 00:19:06,960 --> 00:19:09,639 Speaker 4: so when the transaction happened, you probably thought this is 399 00:19:09,680 --> 00:19:10,879 Speaker 4: a solid transaction. 400 00:19:11,440 --> 00:19:13,840 Speaker 3: You know, they're paying a fair price. But what's happened 401 00:19:13,920 --> 00:19:15,000 Speaker 3: is the gold price has. 402 00:19:14,960 --> 00:19:18,880 Speaker 4: Risen significantly since then and now it looks like a bargain. 403 00:19:19,119 --> 00:19:20,600 Speaker 3: And so I think you're right. 404 00:19:20,640 --> 00:19:24,159 Speaker 4: I think Newmont did really well buying New Crest. 405 00:19:23,400 --> 00:19:26,399 Speaker 1: That was Australia's I should have said, folks, that was 406 00:19:26,440 --> 00:19:30,000 Speaker 1: Australia's biggest called Yeah minor at the time listed what's 407 00:19:30,000 --> 00:19:30,840 Speaker 1: the biggest one now. 408 00:19:30,800 --> 00:19:35,520 Speaker 4: David, Well, new Monk's listed here, so it's still a 409 00:19:35,560 --> 00:19:38,240 Speaker 4: major contributor to the index, and then it comes down 410 00:19:38,280 --> 00:19:41,720 Speaker 4: to Northern and Evolution are sort of the big two, 411 00:19:41,760 --> 00:19:43,920 Speaker 4: and then it drops down a bit. But the point 412 00:19:43,920 --> 00:19:47,360 Speaker 4: I would make on Newmont and New Crest is if 413 00:19:47,359 --> 00:19:49,480 Speaker 4: there's a winner out of that transaction. It was actually 414 00:19:49,520 --> 00:19:54,000 Speaker 4: Greatlan Gold which picked up the tel for Gold asset 415 00:19:54,160 --> 00:19:57,040 Speaker 4: and have her On which was sold by Newmont once 416 00:19:57,040 --> 00:19:59,280 Speaker 4: they got control of that. And it just shows that 417 00:19:59,359 --> 00:20:02,840 Speaker 4: when those transactions happen, it can create other opportunities. So 418 00:20:02,960 --> 00:20:06,080 Speaker 4: to put that in context, Greatland had a market value 419 00:20:06,119 --> 00:20:08,600 Speaker 4: of about a billion dollars at the time it brought 420 00:20:08,720 --> 00:20:12,399 Speaker 4: those assets for seven hundred and fifty mili and so 421 00:20:12,560 --> 00:20:15,680 Speaker 4: say one point seventy five billion in total. Today that 422 00:20:15,840 --> 00:20:18,800 Speaker 4: company is market cap of about nine billion dollars with 423 00:20:18,840 --> 00:20:19,720 Speaker 4: another billion. 424 00:20:19,480 --> 00:20:20,480 Speaker 3: Dollars in cash. 425 00:20:20,600 --> 00:20:22,879 Speaker 4: So it's generated more cash from the assets that are 426 00:20:22,920 --> 00:20:26,440 Speaker 4: bought than the pay price that paid within sort of. 427 00:20:26,160 --> 00:20:27,320 Speaker 3: An eighteen month period. 428 00:20:27,400 --> 00:20:32,200 Speaker 1: So incredible, beautifully don So somebody did win out of 429 00:20:32,200 --> 00:20:34,600 Speaker 1: the New Crest situation. So what about today? Tell me 430 00:20:34,680 --> 00:20:39,560 Speaker 1: who stocks you mentioned? Service stocks by name for our listeners, 431 00:20:39,600 --> 00:20:42,600 Speaker 1: are the stocks you could point to and say that 432 00:20:43,040 --> 00:20:46,040 Speaker 1: this stock would seem to be very well situated for 433 00:20:46,119 --> 00:20:47,760 Speaker 1: the point we're out in the gold cycle now. 434 00:20:49,600 --> 00:20:49,840 Speaker 3: Yeah. 435 00:20:49,880 --> 00:20:52,960 Speaker 4: Look, I think if there's a standout producer, it's Genesis. 436 00:20:53,160 --> 00:20:57,919 Speaker 4: So Genesis western Australian based producer run by Raley Finlerson, 437 00:20:58,440 --> 00:21:01,000 Speaker 4: who is probably recognized one of the leaders in the 438 00:21:01,000 --> 00:21:01,600 Speaker 4: gold sector. 439 00:21:01,600 --> 00:21:03,480 Speaker 3: I've been in the industry for a long period of time. 440 00:21:04,080 --> 00:21:06,600 Speaker 4: The company has has been through a bit of a 441 00:21:06,600 --> 00:21:10,000 Speaker 4: consolidation building up its production from two sort of production 442 00:21:10,119 --> 00:21:12,960 Speaker 4: hubs in Western Australia. It's due to come out with 443 00:21:13,119 --> 00:21:16,280 Speaker 4: a new five year production plan within the next couple 444 00:21:16,320 --> 00:21:18,480 Speaker 4: of months and I think that'll give the market a 445 00:21:18,520 --> 00:21:19,119 Speaker 4: bit of a kick. 446 00:21:19,560 --> 00:21:23,479 Speaker 3: So that's one we really like. Another one is Capricorn. Again. 447 00:21:23,800 --> 00:21:27,200 Speaker 4: You know, the consistency here is strong management, strong balance sheet, 448 00:21:27,400 --> 00:21:31,879 Speaker 4: very identifiable growth projects, focus on keeping costs low and 449 00:21:31,920 --> 00:21:33,280 Speaker 4: located in T one location. 450 00:21:33,520 --> 00:21:34,920 Speaker 3: So you know Capricorn. 451 00:21:35,080 --> 00:21:37,520 Speaker 4: It's got a relebly small mine in Western Australia at 452 00:21:37,560 --> 00:21:39,680 Speaker 4: the moment called Color Window, producing about one hundred and 453 00:21:39,680 --> 00:21:41,560 Speaker 4: twenty five thousand ounces. That'll go to one hundred and 454 00:21:41,560 --> 00:21:44,760 Speaker 4: seventy five thousand ounces. But the hidden asset is really 455 00:21:44,800 --> 00:21:47,560 Speaker 4: Mount Gibson, which will be one hundred and fifty to 456 00:21:47,600 --> 00:21:49,600 Speaker 4: turn one thousand hours producer. We should come on in 457 00:21:49,600 --> 00:21:52,520 Speaker 4: the next couple of years. So again, good growth and 458 00:21:52,560 --> 00:21:55,240 Speaker 4: really what you're looking for is production growth, having a 459 00:21:55,240 --> 00:21:58,240 Speaker 4: good handle on costs, and ultimately generating really good free 460 00:21:58,280 --> 00:22:01,879 Speaker 4: cash flow without ideally without hedging, which can can be 461 00:22:01,920 --> 00:22:03,560 Speaker 4: a bit of a burden in this kind of market. 462 00:22:04,640 --> 00:22:08,199 Speaker 1: Yes, it's amazing how they can get it wrong. Gold miners, 463 00:22:08,560 --> 00:22:09,720 Speaker 1: you say, oh, how could. 464 00:22:09,520 --> 00:22:10,120 Speaker 2: They get it wrong? 465 00:22:10,200 --> 00:22:12,239 Speaker 1: You know they can get it wrong, can't they They 466 00:22:12,480 --> 00:22:14,639 Speaker 1: have they can get the hedging appallingly low, or if 467 00:22:14,640 --> 00:22:16,320 Speaker 1: you've watched this for a long time, hedging can go 468 00:22:16,440 --> 00:22:20,000 Speaker 1: terribly wrong. Operations can go terribly wrong, the weather can 469 00:22:20,040 --> 00:22:21,680 Speaker 1: go wrong. All sorts of things can hit. But that's 470 00:22:21,680 --> 00:22:23,000 Speaker 1: the risk you take, and if you get it right, 471 00:22:23,040 --> 00:22:25,040 Speaker 1: you get it very right. Interestingly, I would say one 472 00:22:25,040 --> 00:22:27,520 Speaker 1: thing about David. The two stocks mentioned by David there 473 00:22:27,560 --> 00:22:30,159 Speaker 1: the first two Genesis and Capricorn. They were both mentioned 474 00:22:30,200 --> 00:22:33,760 Speaker 1: by June Bailu when she did a handful of picks 475 00:22:33,960 --> 00:22:36,520 Speaker 1: stock picks right across the sector in our opening show 476 00:22:36,520 --> 00:22:40,240 Speaker 1: of the year, where we were looking at individual stock opportunities. 477 00:22:39,600 --> 00:22:40,080 Speaker 2: For the year. 478 00:22:40,440 --> 00:22:44,240 Speaker 1: Very good David Franklin, Argonaut, Goldfund. Lovely to talk to you. 479 00:22:44,280 --> 00:22:45,680 Speaker 1: Thanks very much for coming on the show. 480 00:22:45,960 --> 00:22:48,200 Speaker 3: Thanks James, it was a pleasure and all the best. 481 00:22:48,480 --> 00:22:51,720 Speaker 1: Thank you David, and thank you folks for the correspondence. 482 00:22:51,800 --> 00:22:53,680 Speaker 1: We will pick them up on Thursday and we will 483 00:22:53,680 --> 00:22:56,120 Speaker 1: do some batch of questions that have come in and 484 00:22:56,200 --> 00:22:58,560 Speaker 1: we did cover questions in Thursday's show as well. 485 00:22:58,640 --> 00:23:00,000 Speaker 2: Keep the correspondence Rolling. 486 00:23:00,080 --> 00:23:03,400 Speaker 1: Money Puzzle at the Australian dot com dot au Talk. 487 00:23:03,440 --> 00:23:06,480 Speaker 1: Today's show was produced by Leah Samma Glue Talk you soon.