Junior Mining fund to provide investors with diversified exposure

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Thursday, 03 September 2009 08:26

Natural resources specialist Sector Investment Managers is launching a Junior Mining fund to enable investors to capitalise on the demand for gold and other metals through investment in junior mining companies – the heavyweights of the future.

The fund will mainly invest in small and mid cap mining companies, which are often under researched and have the most potential for future growth. Around 70% of the portfolio will be invested in companies mining gold and the fund will also invest in miners of other precious metals, base metals and uranium.

Until 30 September 2009 all investors will be able to buy the fund’s institutional share class, regardless of minimum investment, offering an initial charge of just 0.5% (4.75% lower than the fee for retail shares) and a 0.25% lower annual management charge.

Jim Slater, who owns over 35% of Sector Investment Managers, said: “We believe the price of gold is likely to continue to rise as investors seek a safe-haven investment amid fears of US dollar weakness and inflation. The divergence between mining share prices and the price of gold is the highest it has been for many years and small and mid-cap companies, in particular, should benefit from this in the next stage of the market recovery.

“A major new discovery has a disproportionate effect on the market capitalisation of smaller companies which are also more likely to be taken over as the industry continues to consolidate.”

Angelos Damaskos, Chief Executive Officer of Sector Investment Managers and fund adviser to Junior Mining said: “The fund will focus on companies which already have significant resources, with active drilling programmes. We will apply our skills and proven track record in analysing and identifying smaller capitalisation companies with the potential to outperform. Investments will be diversified across the most promising areas for future discoveries but will avoid unsafe political territories where there is a risk of expropriation or armed conflict.”