A spread coupled with a safety-first investment policy reduces risk

Investing in one mining company can be risky, especially if it encounters a series of poor drill results or if there are other disappointments of a similar nature. A spread of investments across the mining sector excluding the majors and companies with substantial interests in politically risky areas should provide a buffer against unexpected setbacks.

The majority of investments in gold, precious metals, uranium and base metals will be in companies which already have significant resources, many of which will be 43-101 compliant or have reserve status. In the case of uranium stocks in particular the capacity to bring mines into production before 2013 (when prices might peak) will be a major but not necessarily exclusive factor.

In addition, the fund will spread its investments to cover some of the most promising areas for further substantial discoveries in the world today. Africa, the Far East, Australia and Latin America will be the prime areas of interest as it is believed that they contain a very high proportion of the world's undiscovered mineral resources. A spread of investments will help to ensure that if any of these areas are particularly successful the fund should benefit. This is especially the case as the fund will be cutting losses and running profits.