Last chance to buy cheap gold

Regular listeners know I’m not a permabear or permabull. You’ve got to be able to change your opinion when the facts change… So while I’ve been cautious on equities over the last several weeks, a new global fund manager’s survey is making me bullish.

Ivan Bebek is chairman and director of Auryn Resources… with over 20 years of experience in foreign negotiations, financing, and acquiring companies in the mineral exploration industry. Don’t miss this insider’s take on the junior gold mining sector… along with some very exciting news [20:10].

In my educational segment, learn why proper position sizing is key when investing in an idea… and one rule of thumb everyone should know [58:55].

Transcript

Wall Street Unplugged | 674

Last chance to buy cheap gold

Announcer: Wall Street Unplugged looks beyond the regular headlines heard on mainstream financial media to bring you unscripted interviews, and breaking commentary direct from Wall Street, right to you on Main Street.

Frank Curzio: How’s it going out there? It’s June 19th. I’m Frank Curzio, host of the Wall Street Unplugged podcast. Where I break down the headlines, and tell you what’s really moving these markets.

Over the past month or so, I’ve been telling you guys I’m nervous about the markets. I haven’t been this nervous for a couple years. Well it’s because of the uncertainty, right? Uncertainty when it comes to tariffs, and trade with China where, depending on what Trump’s going to tweet that day, it’s either good news or positive news. Basically, every other day, it changes, right? “It’s great! I’m going into a trade war!” We’re not. We’re going to solve it. “We’re going into a trade war!” It’s just kind of crazy how the market moves so much on that, but there is uncertainty.

Washington is a complete mess, right? By now, you should know, I don’t care what side you’re on, these guys don’t care about you, don’t care about me. They just care about power, right? But there’s a lot of uncertainty, nothing getting done. Nobody cares about infrastructure plans, or anything crazy. It’s just, hey, if one person comes up with one idea, the other side, the other party, is going to disagree with it no matter even if it’s great. It’s just, that’s the way it is. That’s a big risk with Washington.

You have Brexit. I mean, is it happening? Is it not happening? I mean, what’s the latest, right? You have international markets seeing a lot slower growth. Pretty scary. Europe, even China, seeing an overall slowdown in earnings growth.

In our newsletters, it’s just stock news that I have, courtesy of Research Adviser, courtesy of Venture Opportunity. Took some money off the table. Not a lot. But it did cut some losses, also it took some profits in several positions, and I also said last week that, you know, we are starting to see a lot of insider buying, which is a positive, in particular, names that have gotten crushed even though they posted solid earnings last quarter, which took place, what, a few weeks ago? You may be asking, why would these names get crushed after posting strong results? Because the results for the quarter were strong, but they refuse to raise their full year guidance.

So if you’re supposed to earn $1.00 in the first quarter, just saying, and then you earn $1.30, at the end of the year, it’s supposed to be $4.00, again, hypothetically, you would think that you would raise it, and they’re not raising, which signifies that maybe things aren’t going to be that good. It’s not that. It’s more about, management teams don’t know what’s going on. I mean, tariffs could impact these companies tremendously. It’s going to affect their supply chains, and they’re being conservative.

So, again, a lot of uncertainty going on, but we are seeing insider buys. A lot of the companies with tariffs gotten hit over the past month is starting to rebound a little bit. Not just China names, but even retailers. People that really do believe there’s going to be an actual trade war, long-term trade war, it’s going to be terrible, between China and the US, whatever. We’ve seen some stocks go down 25%, 30%. For me, I like to see the insiders buying. Especially when they just reported pretty good numbers.

I’m getting to a point here. Because if you follow other analysts, which a lot of you do, or money managers and newsletter writers, whatever it is, often when they make a call similar to like I have, or they just have a call in place, it’s kind of like forever. This is how I feel, position yourself accordingly, buy treasury, short growth stocks, short Europe, buy utilities, consumer staples and gold, and you know the drill. But over my 25 year career, I’ve seen… You know what? I’ve not only seen, I’ve actually worked directly for permabulls and permabears. A lot of these so-called experts are never going to change their opinion, regardless of the facts. I bring up this example sometimes, which is the credit crisis, where the whole world was pissed off at Wall Street and there were so many problems.

I’m talking about after we’ve come out of the crisis a little bit in 2010-2011, but there was permabears saying the market’s going to crash again. It’s going to be worse than 2008. Yet, if you just took a step back, you’d realize that the government was backstopping everything, took all the bad debt off the balance sheets of just about every major financial institution, guaranteeing it. They invest directly into banks, AIG, GE, Fanny, Freddy. They gave checks to individuals to buy cars and homes, and they lowered rates to zero. They say history repeats itself. First time in history, zero interest rates to create inflation.

If you took the emotions and all the agendas out of the equation, you would have realized that every asset was about to surge. There was basically no risk, because everything was being backstopped. So you should buy a home, art, collectibles and, of course, own stocks since interest rates were so low that investors had no choice but to push more money into stocks, and we’re talking trillions of dollars. What people are looking for, no risk income, right? That’s the goal. And when you can’t get that, and treasuries, or you can’t get the interest rate to zero, it forces you to go into other avenues, especially assets and consumer staples and utilities, and the multiples on those things went up tremendously, because they also pay to yield.

But the permabears and permabulls, these so-called experts that basically never change their mind regardless of the facts, are incredibly dangerous to you and your portfolio but, more importantly, your generational wealth. That’s the money you’re going to leave behind for your kids. And there are people telling you to, “Buy gold! Buy gold! Buy gold!” For how long? “Put it under your bed! Put it under your bed!” Well, the market went up tremendously. They didn’t take a step back and just look and there’s a lot of things out there. I’m not picking on people who are wrong, but to really push the gold theory out there, why you should own gold and the dollar’s going to disappear. Riot’s in the street for the last 10 years with all the things that happened over that time frame where… I don’t know.

If you really took a step back and didn’t have an agenda, you probably would have said, “Okay, maybe I should allocate 5%, 10% to gold, not so much into it.” And you know why? You significantly underperform the market in one of the biggest bull markets in your generation. Where am I going with this? Great investors are always willing to change their minds on a dime if the facts change. I have to tell you, I know I’ve been bearish, there’s an indicator I follow, I’ve followed for the past few years that’s been dead on when it comes to predicting market moves.

In other words it’s a great leading indicator. You know what, it totally contradicts to what I’ve been telling you. Saying that you should be cautious right now. And for me as a researcher I love reading stuff like this. Sometimes people hate it. Like if you are … even politics, if you’re democrat or republican you really, even if it’s a good idea you don’t want to hear it because it’s from … No. For me, I love listening to the other side. You’re a research analyst. You want to get all the facts straight. You want to hear the positive and negative. You don’t want to talk to everyone who’s positive on the same thing that you’re positive about.

You want to get the story right, and that’s how you make money. So for me I love talking to experts that have a different opinion that me. It just validates my thesis. Or could change it depending on what information they’re saying. But again we all want to get our predictions right and to do that, the more people we listen to, every source, the better chance you have on doing that.

Now this indicator, it’s called the global fund manager survey. It’s a survey published by Bank of America every month. So basically Bank of America surveys around 230 fund managers and combined these guys have about 650 billion dollars in assets in the management, it’s a big deal. So they survey them ask them a bunch of questions, they’ll tell BofA about the allocations, expectations for the global markets, bond market, economy, domestic equities. Now the last survey was taken between the seventh and the thirteenth of June and was published yesterday, which is Tuesday.

I want you to listen to some of the data points from this months’ survey. Quick heads up because it’s about to blow your mind. At least it should, because it blew my mind. It was very surprising. Some of the things I found from the survey: Investor confidence, the most bearish since the global financial crisis, really, right now? That’s how bearish you are? I’m bearish but not 2008 bearish, right. Very surprised. This is by the people who invest in companies, in stocks. 600 billion dollar plus of assets under management. This isn’t just a survey of CEOs or things like that. These are money men that are putting money to work.

They have a bull bear indicator that’s dropping to almost the biggest buy signal that they’ve seen in years. The cash levels, again from last month, surged to 5.6% from 4.6%. That’s a surge when it comes to cash. To put that in perspective the biggest jump in cash since the 2011 US debt ceiling crisis. That’s how nervous these guys are. You got equity allocation, second largest drop ever. We talk about equities over bonds. How people are going more into bonds.

Lowest drop since 2008, second largest drop in equity allocation ever. Ever. Growth expectations. They plunge by the largest amount since November 1994. You look at the fed and how they view the fed. In the eight months, in just the past eight months, the percentage of investors expecting higher short rates has flipped from 89%, right. Everyone’s like, “Hey, rates are going higher. Rates are going higher.” It’s at zero. Lowest since 2008.

So you’re looking at these indicators. You’re seeing a massive rotation of capital into a bearish stance. This is just June. So the rotation is going to bonds, cash, staples, utilities. Going away from equities, banks, Euro-zone, technology. But you have to look at this as a contrarian investor. And it should make you really bullish. Because if you’re bearish, like me, basically part of the crowd. And I told you, more times than not, you don’t want to be part of the crowd. When everything leans to one side, which everything’s leaning to one side, this makes me worry that stocks can move significantly higher from here.

I have no idea where stocks are going over the next month, six months, nine months. But for me, as someone who’s cautious right now, it definitely alleviates some of my concerns about stocks falling hard. It makes me take a closer look. Especially at the sectors that are on the BE Forum, especially at the companies that are down 24%-35%, where insiders are buying. It gives me a little bit more conviction.

When you look at the smart money and how they’re positioned, remember when it comes to fund managers, the stock market is a game. They need to beat their benchmark period. That’s it. That’s your job. That is your job, to beat your benchmark. Period. That’s it. If you ask any, “What’s your job?” To beat the benchmark. Not to make you money, whatever. It’s to beat your benchmark.

So the market falls 15% and they lose 7%, that’s a massive win for them even though they’re down 7%. Massive. Yet the market’s up 20% and they’re only up 10%, it’s a huge negative. They could lose their job for that. Why? Because why would you pay that guy of that fund massive fees when you could buy a SMP 500 index fund, which outperforms you, and pay what 0.14%? That’s actually the percentage on the Vanguard SMP fund, 0.14%.

But beating the benchmark, that’s how they get paid bonuses. That’s how the employees get paid bonuses. It’s how they get raises. It determines if they’re going to keep their job. So, if stocks are running higher, which we’re seeing in the past couple weeks. While they’re on the sidelines they must find a way to catch up to the generating alpha, which basically means they’re going to have to start buying stocks to keep up with their benchmark. Unless they want to lose their job. Unless they don’t want to get bonuses.

And with so much money on the sidelines, and so many of these hedge fund managers, and fund managers really nervous to the point their allocation between stocks and bonds is near record high in terms of being conservative. You could see stocks continue to move higher over the short-term. Now I expected somebody to come off the table. I expected people to get nervous. There was uncertainty. I didn’t expect to see levels that we’ve seen during a credit crisis. Really? That’s how nervous you are right now? Earnings are growing. We’re doing okay. The economy’s pretty fine. It’s not great. Housing’s okay. Slowing down, lower interest rates, refinancing. Looking at lower interest rates going forward, it’s not a horrible environment. I’m not going to tell you and say it’s the greatest environment, but you’re comparing … They’re positioning themselves similarly to how they positioned themselves in 2008. That was a big surprise to me.

If I had an agenda I’d be like, “Doesn’t matter. I told you, I’m nervous. Sell stocks.” Or whatever. And you have to be careful when people have an agenda. So for me, I’m I confusing you? Yeah, maybe I’d be confusing you right now, because you’re like, “Whoa, what should we do? Should we buy stocks or not?” For me, I want to get the story right. That’s how you become a good analyst. You want to listen to people who have different opinions from you.

For me, this makes me a little bit more bullish. Doesn’t mean I’m taking everything I own and throwing it into the stock market. But, it makes me not as cautious because the data changed. Because I saw something that’s a huge data point, a leading indicator that I’ve used for a long time, that’s important to guys. If the facts change, you change. Period. Don’t keep running into the wall, running into the wall and making the same mistake. “This is what I believe!” Don’t get stubborn.

And it’s easy to get more stubborn with the more people that doubt you. It really is. If you like a stock and they’re like, “You’re crazy for liking Tesla. You’re crazy for liking Tesla.” At 160-170. What is it? 220 now. Usually when you hear that it usually means that you’re right. But also, you become stubborn to the point where you start liking it even more because people are just ragging on you so much. But the point is, when it comes to sediment or it comes to researching stocks, you want to look at everything possible. And that survey blew me away. It definitely made me a little more bullish, not as conservative anymore. And that’s what I want to try to teach you with this podcast. Because so many people out there have an agenda, and they are destroying individual investors. They’re destroying your generational wealth.

Think about all the guys you’ve listened to that told you the market’s going to crash over the past 10, I won’t curse, fricking years. How many people have you listened to that said 30%? And the next year, “It’s going down another 40%.” If the market got cut in half from these levels, they’d still be freaking wrong from their early prediction in 2011, 12, 13. And the worst thing is they think they’re right. And to make things even worse than that is they’re making a ton of money selling books, revising them, they get paid to go to certain conferences even though they’ve been wrong. You know all these guys own their own company because if they worked for anyone else they would have got fired like eight years ago. Right?

So they start their own companies this way they can be wrong forever and no one’s going to fire them. But it is kind of amazing when you think about. So guys, be open to anything. Be open to changing your mind at all times. Especially if the facts change. Did the fed come out today? Yeah, probably going to lower rates. Not too much of a change, market didn’t really do too much. But just always look at the data, always look at the facts going forward. But if things change, be prepared to change. You don’t have to be scared to change your allocation in stocks, to go a little bit more into cash, or be a little bit more aggressive.

But this survey was very, very interesting. It blew me away. Something I watch all the time and usually I just sit through it. It’s kind of like a little basic. But some of those numbers, I was telling you. Pretty crazy. Levels and your nervous since you’re not seeing such a credit crisis since 2011. It’s just 1994, some of these things in terms of allocation and how conservative they are, a lot of that money is going to come into the market, especially as it goes higher because they need to generate alpha, they need to outperform and that is definitely a bullish sign for stocks.

Now, I have a great, great interview set up for you. His name some of you should be familiar with by now, is Ivan Bebek, Executive Chairman at Auryn Resources. He was on my podcast in mid-March. He was bullish on his company, and he’s not a guy that comes on as crazy bullish, “Buy this!” No. He was just very optimistic with everything that’s going on. He’s drilling results and you know what? The stock surged about 40% over that timeframe and he pulled back a little bit since then. Still nicely since he was on, on very good, very, very good drilling results. And a market where most resource stocks have underperformed, at least over that timeframe. Past three weeks they’re catching a bid a little bit, some of these stocks.

But he’s definitely outperformed the market. So I reached out to him for an update, since I got several requests from you, my listeners who bought the stock after listening to him. We also put it in our all-star portfolio we’re up on. Guys that’s where we take a stock from our guest, every week, sometimes it’ll be offline when I talk to them, sometimes it’s a stock that they mentioned on a podcast and we write it up, do a nice research report, and it’s extremely cheap service. It’s a great service, we’re going to market the hell out of it. It’s just an all-star portfolio getting picks from all the people that I interview and it’s incredibly cheap. So we’re really going to market this. We think it’s a unique service that nobody else could really offer because they’re not interviewing some of the great minds on Wall Street and great analysts.

But anyway, we threw it in our all-star portfolio. He’s a subscriber there. They know that you’re up and you’re doing well. But I’ve got a lot of requests that say, “Hey, can you get him back on? There’s a lot of good things going on.” So I reached out to him, he decided to come on. If you aren’t familiar with Ivan, he is one of the most brilliant people you’ll find in the resource sector. Several huge successes. Turned Keegan Resources from an early stage vendor into a producing project. They sold Cadan Resources for over 200 million dollars to Agnico Eagle in 2014 guys. One of the worst market for resources. An incredible job.

But he has a history of making his investors a lot of money, which he’s now trying to do with Auryn. So what I love about Ivan, he’s a humble guy, incredibly hard worker, he cares about his investors. He’s not somebody who only comes on this podcast or does interviews when things are good. He’s always available, always transparent. It’s probably the reason why he’s so admired by some of the biggest names in the resource sector. So guys, really, really great interview coming up and I love to see when you guys make money. He’s going to give you an in-depth report on what’s going on, and trust me, he’s going to blow your mind with some of the statistics and things and numbers that he’s going to share.

Then in my educational segment, I’m going to break down one of the biggest mistakes investors make in their portfolio. And it’s not picking losers. We’re all going to pick losers sometimes. It’s not selling too early which, again, a lot of us do. It’s not following your stocks, although this is a major rule that should almost never be broken. You want to limit your losses. This is something simple. I’m going to help you correct, in a minute. You want a good analogy? Think of a golf lesson where all the sudden you start hitting the bad and it’s usually a minor adjustment and next thing you know you’re hitting it straight.

But it’s going to be very, very important to learn this. Because this minor adjustment I know a lot of you make. A lot of amateurs make by the emails that I get. And again, I read a ton of your emails that you send to frank@curzioresearch.com. So it’s going to be a quick fix. It’s going to help you generate much better returns on a risk-adjusted basis. But much more important, it’s going to allow you to sleep a lot better at night. So really cool stuff coming up.

But first, let’s get to the quick breakdown of Auryn Resources from one of my favorite people in the resource industry, Ivan Bebek. Ivan, thanks so much for coming back on the podcast.

Ivan Bebek: Thank you so much for having me here. Good to be back.

Frank Curzio: Well, whenever I have you on, I love talking about the macro outlook with you. Because obviously you’re in the field, you’re always traveling, talking to investors, institutions. I think the last time I had you on was in March. Goal was around 1300. Nothing exciting going on but today we’re pushing 1350. Maybe trade concerns is pushing gold up, solo growth around the world, fears of a possible recession, numerous reasons. But there is a lot of buzz going on in the gold industry right now. It’s even the first time maybe since early 2016. Is sentiment for this sick little sector finally starting to go positive. At least, what are you hearing out there?

Ivan Bebek: Absolutely, it’s been a drastic shift in sentiment, and you can see it if you open up any kind of gold website that follows gold and if you’ve watched the gold price performance in the last few weeks, it really caught everybody by surprise. And because the gold’s been suppressed for the last couple years, or since 2016 as you pointed out, people have kind of surrendered to the bears, and the gold space. And as soon as gold started showing some life all the critics came out and people are asking themselves, everyone’s asking each other the same question, “Is this the start of gold, or not?”

And then you made reference to the macro picture, and as you’re well aware, the said meeting I think is in half an hour as we speak here, or 20 minutes. And we’re going to hear what the fed’s going to do in line with the trade war that you see with China. This talk of a loosening of the monetary policy in the U.S. There’s talk of the potential of lowering rates. If the verbiage is really dervish and they take a direction going towards a looser monetary policy, gold is going to start to take off and forget about 1350, 1400. We’re well on our way to 1700 plus.

We go back to this gold market we haven’t seen since 2009, 10, 11 where we ran into 1900. So we’ve been overly patient as gold investors. We’ve seen some great windows where you can have some spectacular returns, but on the macro picture, and I have to under pin this because of some things we’ll talk about today. Nobody’s finding gold mines of significance. And people say, “Sure, Ivan, but there’s plenty of gold in the world.” Sure. The gold market, entire market cap of every gold company in the world fits into one pet company. It’s a tiny market. The world population has doubled in the last 20 years.

Where are you going to go to counter balance a looser monetary policy, a weakening dollar, and where are you going to go if inflation becomes a major factor? Now, I personally would go into gold, physical hard asset. I think the performance on the horizon is very obvious. And so, that’s my personal opinion. Recently in Vancouver one of our industry legends, Ross Biti, he just went around talking about his company Equinox Gold and he told everybody and I’ve heard a lot of really positive feedback that he said he doesn’t know when but in the next 12 months gold’s going to take off. I think we’re at the end of a much bigger macro picture of a 10-year cycle of gold being in kind of a secular bear market and I think we’re about to come out of that and we’re going to go on to something that’s going to really take off next year and through the election once the world’s corporate debt unwinds on top of all these trade wars and the softening or lowering of rates and the softening of the US monetary policy.

So a tremendous opportunity in the gold space. I bought as many gold stocks as I could. I’ve maxed my portfolio out about three weeks ago, or four weeks ago. So far that’s been a very right decision. And I mean it, for the next couple years I think we’re going to see a drastic shift to the upside in the gold space.

And just to be clear guys, Ivan you are not a permabull or you’ve come out of this pocket and said, “Look, the outlook is still cloudy.” Because a lot of times when you get CEOs of a particular industry they’re going to talk great about their company, great about the macro part, but this is the most bullish I’ve seen you on your outlook at gold probably since I’ve been interviewing you, at least over the past four years.

So on that basis, I’ve encouraged all my in-laws on my wife’s side and friends and family to build substantial gold portfolios. I will say this, I’m probably early by about six months, but I’d rather be early in the gold market then late. And those of you who have followed gold you know this very well. If gold spikes over 1400 or breaks the 1370 ceiling, the gap that occurs on a lot of these gold stocks makes it really hard to buy. And then you catch yourself buying 20% higher, uncomfortably long, and wondering if that was a mistake or if this was the time to go buy it. For me, buying it 20% earlier, which I think is the next six months, is a no-brainer. I think everyone’s protected. I think the cycles in a macro sense where you can go really long, and you’re not going to be wrong. It’s just how right are you going to be and how soon is it going to happen?

Nobody knows when gold’s going to go big. You would not be able to speak to that person. You’d be reading about that person if somebody could actually figure that out. But it could happen today at the fed meeting. It could happen with some kind of escalation in Iran in two weeks from now. The trade wars. Who knows? Look at the U.S. president. He’s a very, very unpredictable individual that has no filters and he’s definitely toughened the U.S. image on the world scene. If that results in a big war somewhere, we don’t know. I think having a good exposure to gold is awesome and I think now is your last window of this kind of cheaper pricing.

And then if I quantify it to the junior mining companies, which is how this gold market continues to find supply over time, which has had such a hard time. A lot of guys have had a hard time raising money or getting paid for successes that they may be close to or recyculators. You look at that environment and it’s improving. We’re starting to see people come back towards gold. I’d rather be really early. And you know who’s got it right and they always get it right first, is the Swiss. The Swiss are always the first. The U.S. is usually second, and Canada’s the third. And on the way out when gold runs at 18, 1900 or wherever it ends up going this time around, the Swiss will exit first, the U.S. will exit second, and Canada the latest.

And people always ask, “Why is Canada, who’s so integrated with mining, why are they always the investors that get caught holding the bag?” It’s real simple. It’s our pastime. We’re the most biased investors we can be on the mining side and we have the hardest time letting go because we know the quality of the mine. So if you follow Swiss money, which I do, and U.S. money as leaders, I think U.S. is about to start buying gold properly and I think the Swiss have already, well I know they have already definitely started.

Frank Curzio: Yeah, you definitely see it even with hedge funds. You see them talking about CMBC now. So you are seeing the smart money institutions actually take some positions in gold. Now, how does that translate into Auryn Resources? Which you’ve done a fantastic job during this bearish cycle. And maybe before you really get into it, let’s assume that people are listening to this for the first time. Guys, I’ve been interviewing Ivan for I think over three years now and the last time he came on was March. And you were incredibly bullish about your stock with everything going on. That’s one of the reasons why I wanted to have you back on. You come on no matter what. It’s not only when it’s good. When things are bad, and I love that, but I wanted to ask you to come on because everybody that listened to you in March is up a lot.

Your stock was up more than 40% and pulled back a little bit now. Still up a ton since you were on. But why don’t you give us a little background on Auryn Resources real quick for the people who are listening to you for the first time.

Ivan Bebek: Sure. So, by introduction, myself and my partner, Sean Wallace, came together. We created a little company called Keegan Resources back in 2005. We set out to go find a 5 million ounce gold deposit and seller company. We found the deposit. The company was worth 900 million dollars from a million dollars when we started it. Share price went from 50 cents to nine dollars per share. We were not successful in selling the company because the market peaked and started to go down and the buyers got cold feet at the very final hour. So we ended up building a 10 million ounce gold mine.

Second best thing you could do for your shareholders. If you don’t sell your company you go build the mine. But it’s not something that drills myself personally. I’m an experationist. I love to find it at heart. So we started a second company during that peak called Cadan Resources and we said, “Let’s go do what we were doing in Keegan, our first company, and see if we can go and find something of world class and sell it and make investors’ money.” This company, it started high and it went low. It started at about four dollars Canadian and went down to 67 cents and we got onto a really good project in Mexico which resulted in 2014 of a sale to Agnico Eagle for 205 million dollars. The share price was about $3.58 per share.

If you held Agnico for the following year, 14 months longer, you would have got about seven dollars per share because they doubled and we all received shares with Agnico. So imagine that return, middle of the bear market, we had 100 drill holes into this project, no resource, no official mine. We sold the company from 67 cents to $3.58 and then we watched it go to seven dollars a year later. So people made about 10 times their money in that transaction in that period of time amidst the bear market.

What that did was it gave us a huge wealth of financial supporters from those two deals and we thought, “Let’s go and do something even bigger because this business is driven with greed and we want to do something bigger.” And when you do it twice you learn how you can do it better as well. So, what we did with Auryn was we went, and we met these gentlemen from Hanumantrao, the world’s largest gold mining company today because they bought gold carts. And we went about these world experts, it was about seven of them that led the global team that would go find ounces for new mines.

These guys came to us in that bear market shift and everyone’s driven with finding gold mines and that’s something that stops with majors and bear markets. So we went out, we built a major portfolio, seven projects, and all the kinds of ones that would move a needle for a new mine or a major mining company. We were focused on gold and copper which are two of the best commodities, I think, and the unanimous crowd would agree, to provide the most robust returns the next few years based on commodity price outlooks. We spent 100 million dollars in the last four years. We’ve raised and spent that and included an investment from Gold Core for 36 million dollars at a 23% premium to our small price at the time, about 367 Canadian.

And so we spent real money. We had a strategic investor and he asked me, “What came out of that, Ivan? Where are you guys at today?” We’re at the stage of two of the projects that have made a world class stage. World class stage and [Sandstat 00:30:33], they’re upside potential is not repeated in any junior that you’d go to look in, whether it’s gold or whether it’s copper. Gold for us in Northern Canada, copper down in Peru. We’ve attracted several CAs with the successes we’ve been having in the last 12 months and the money we spent went to figuring out exactly where these major gold deposits or copper gold deposits are going to occur in these projects that we’ve identified and got to the stage. And it’s the most exciting stage of where you’re on the edge of discovery because this is where the most robust price return is going to be.

The gold project is in Northern Canada. It’s extremely hard to work up there, because it’s like the moon. You can’t see the rocks. There’s about five to 20 meters of dirt on top of the rocks and glaciers moved over top of top of those dirt for years to come. What we did there, we got really close last year. But we brought in an artificial intelligence platform which I’m sure we’ll talk about today. We’re on the verge of being the first ever in history of making artificial intelligence work to find world class major gold deposits in conjunction with our geologists.

And in the recent share price, up until probably the last few days, has been driven by a project in Peru called Sombrero. And this is a pretty exciting project for us because the size is most certainly there. There’s a belt in Peru that has some of the largest copper [inaudible 00:31:51] deposits in all of Peru, known as the Las Bambas district. The mine Las Bambas was sold in 2014 for eight billion dollars. The metal value was six billion dollars. It’s a 60 billion dollar gross value of metal in the ground. It was bought by a Chinese company from GlenCorp, a name called MMG bought it.

What we feel we’ve done in Sombrero is we went further west from this belt, not far, 100-200 kilometers which is a stone’s throw away in geological belts. And we feel we’ve mirrored that entire belt in our land position, meaning we’ve staked a footprint that would represent all those mines next door in our land position. And a lot of people didn’t go here because there’s volcanic cover. There’s five to 40 meters thick of volcanic ash that covered the rocks. So people can’t see the deposit sticking out of the ground. Volcanic rock is younger than the rocks that host the mines next door. Everybody thought these were the wrong aged rocks. We quickly went on this property, we started doing the detailed work, and we started sampling 109 meters of 0.7 copper, 232 meters of 0.5 and a half. These are the grades of the mine next door. These are substantial lids of the grades of the mines next door.

Now what happened in the last week for us, we found some drill holes that a steel company drilled looking for iron that does not want to find copper. They’re not asking for gold. And we came up with asking their results, again they weren’t targeting the copper/gold. They weren’t drilling the way we would entirely want to drill it and they showed us that there’s the third dimension. There’s 116 meters of 0.58, that’s a little bit better than the grade on surface. And it gives us that third dimension.

So right now we’re waiting for drill permits. If we get this right and this is what we think is going to happen based on the evidence we’ve seen so far, we potentially could be at the start of discovering a 60 billion dollar orebody, or multiple clusters that would make up a mine of 60 billion dollar gross value in the ground in the northern half of our claims. We still don’t know what’s going to be in the south, we’re exploring there as we speak. But, imagine that of a shareholder. Imagine if a company, right now I think our market cap in U.S. dollars is about 150 million, 140 million dollars. Imagine if you found a 60 billion dollar gross metal value in the ground, what the company could be worth. It’s copper and gold. You have two of the hottest commodities and in the background, while we’re doing that, we’re going up to Committee Bay, our northern project to go test to see if we figured out the artificial intelligence to find one of the world’s largest gold mines in this belt and that’s what we’re going to be drilling here in about two weeks’ time.

Frank Curzio: So, talk a little about the grades where you bring everyone on the same level. So we have amazing investors listening to this podcast. Most of them are not geologists. Talk about the grades in this area and what are confirmed, because this news was major. This is really good news. Like you said, it confirms that further drilling is warranted and that hey, this could be big. I guess, talk about the grades and then I have another follow up question because I’m just interested in how somebody else drilled this and that’s how you got the information by someone doing something that maybe you guys might not do.

So I wanted to talk to you a little bit about that. But first, just talk about the grade and how significant it is.

Ivan Bebek: So, on this property, if you were to come with me to Peru right now we’d fly to Lima the capital city. We’d take another plane three hours south to a town called Ayacucho. We’d get in the car, we’d drive an hour and a half up a paved road, and we’d get to the project. What you would see at this project, you’d see hydroelectric power lines going over the property. Spectacular access to power, clean energy, clean burning. You would see a moderate terrain and then you would look around and then you would see windows of copper and gold. And then you would say, “Hey Ivan, this is an incredible big land position. You have water, power, roads. There’s two nearby towns. You have a dream for infrastructure.” I talk about this because this makes grade really profitable, right?

0.5 copper/gold in one part of the world is extremely high grade and it’s your minimum in another part of the world. If you’re in the middle of nowhere and you don’t have access to power, water, and roads, you’re going to need one percent or one and a half percent copper to make an actual deposit actually work. So in our world, and what we show in our press release, we showed some of the major mines next door all either slightly lower, the same range of grade that we have. So, our grade is the same or higher than some of these massive mines next door that are holes in the ground.

So, when you talk about grade, I would say anything about 0.5% copper/gold equivalent in this property, because of its infrastructure, is considered really high grade. That means that anything in that range or higher is going to be considered extremely, extremely profitable. So, on a full disclosure, when we got, and this is related to your second question, we got there we were looking or gold. We weren’t even looking for copper. And we found up to 193 grams per ton of gold on this property. We found an ounce gold. We found half ounce gold. We found several five to seven grams gold occurrences. We haven’t drilled any of these things yet. There will be a major gold budget that goes with this copper project.

So when you talk about a copper/gold explorer or a copper/gold deposit, you might average a grade of 0.15 gold in it, but if you have a billion tons that’s 20 million ounces of gold. That’s a substantial component of value that would go with the copper. So back to the first comment, the grade is equal to the all of the mines next door, arguably better than some of the mines next door. We did not drill this looking for grades. The guys who drilled this were looking for iron. Some other holes are vertical, but are beside the target, they don’t cross the target. And they still have 125 meters of 0.3

Why would you drill a vertical hole beside a target and not drill across the target to see what the targets worth? But knowing that the halo around the target is carrying the grade that’s actually going to make it, in our opinion, to an actual mine plant here. The mine, Las Bambas, that sold for eight billion dollars, they mine down to 0.15 copper. That’s how far they go. We’re talking about 0.5-0.6 as an average grade so far as what we’ve seen here.

So it’s truly spectacular on the grade side. We couldn’t have asked for more. There are high grade components in the copper side. We see 30 meters at 1.9% copper on one part of our property. In these drill holes we see 0.88 copper over 60 meters. These are spectacular high grade components but in the law of copper deposits, it’s the average that matters. And if you take the average of every sample we’ve taken so far, we’re 0.61. Las Bambas was 0.6. So we’re in the ballpark. That should repeat. There is a chance that we get in some really big high grade stuff in some of these targets. And this is the first, Frank, and I think this is what’s [inaudible 00:38:29] from the market. This is the first major deposit that could be a hole in the ground of seven targets we’ve identified to date. Which means we believe we’re going to repeat this opportunity seven times in the next 18 months as we go drilling and we start to get access to different targets to go sample them and continuously show the market.

I would argue, based on everything we’ve seen so far to date, this is the third best one. And the best one is going to come, I believe, next. We’ll get access to it in July. It has 9% copper on surface, 5 gram gold, it has 4% copper and 2 gram gold. This area has the most amount of outcrop. And remember what I said earlier. There’s volcanic ash that’s covered a lot of the rocks. We’re not sampling the rocks that we’re targeting to see the best results. We’re sampling what mother nature has eroded, little windows, saying you can sample there and you can sample there. But we don’t get to sample all the areas where all of our other geology and all the work we’re doing is saying your target is here or there. We have to use electricity to send a current to the ground to reflect off the rocks or we have to use magnetic currents that go into the ground to give us a signature to be real generous about it.

This tells you what might be subsurface. So what did the drill holes mean the other day besides they confirmed that the third dimension of the huge luck of these deposits occurring in this part of the belt that we might be able to repeat this entire belt here. It confirmed that the grade is there. But what’s even more important, now I have to go and put on somebody’s geology hat to say this, but in layman terms it gave us a fingerprint of the signature we have of what’s underneath the surface in a vast area, about seven kilometers long. We see a signature that is the same as this drill hole. Arguably there’s some windows on it that have some higher grade that go with it. So if you go and say, “Okay Ivan, well what kind of signature is it?” Well one of the target’s is going to be 350 meters to 400 meters thick is what we anticipate.

We don’t know what the grade’s going to be. It goes up to two percent on one side of this target and our drill holes of 0.58 on the other side of the target. Is it going to be three and a half kilometers on this target of two percent? That would be a 50 dollar share price, or a 40 dollar share price, if you found something like that. The possibility’s there. Or is it going to be 0.5? What would that mean to a share price if it’s 0.5? If it’s 0.5 on the conservative side you’d be looking at probably 10-20 dollar share price. That would be a very realistic outlook based on the scope and scale of how much more of this fingerprint exists on the property. So, when we go look at these things, Frank, we always ask our self this. When are we going to feel that this is going to be a hole in the ground? When can we throw the major expiration risk out the window and say there’s a 90% chance this is going to be a hole in the ground? We just don’t know how rich the hole’s going to be in the ground.

We’ve passed that. We passed that about three days ago very, very surprisingly. People were speculating. Our stocks sold off. And as you all [inaudible 00:41:31] buying rumors, selling news. But if you can afford to and you have the capacity and you like, major discoveries that get all the world’s major mining companies attention, which we most certainly have done here. And if you like the 10-20 times your share price return, we’ve just reduced the risk for that and created that opportunity with 1000 times more confidence than we were before we had these drill results. And that’s where we are right now.

Frank Curzio: So talk about, because the stock has run up, and you’re doing all this massive right on good news. And we’ve seen this, and I’ve seen this personally in so many companies. When they do report good news it’s almost used as a liquidity event to sell shares. Stock is still up since the last time you’ve been on, up nicely, but it has come off. And based on the things that you’re telling me, that things that I’ve analyzed, the future looks incredibly bright for you guys and incredible growth potential. But the market also knows that you’re probably going to need to raise money, because it’s going to cost a lot of money to drill these areas. Talk about that a little bit, because when I see people raising money these days, I think this goes to the quality of your company and yourself and your credibility, because you’ve been raising money all your life and a lot of companies that need to raise money will offer three year, five year warrants. Guys, I won’t get into it, but-

Ivan Bebek: Sure.

Frank Curzio: Any three or five year warrants, it’s a license to share with the stock most of the time. You make money it. But you refuse to do that.

Ivan Bebek: Absolutely.

Frank Curzio: And I think the street is anticipating some kind of capital raise and maybe that’s why it’s selling all short positions. I talk about that whole thing because you’ve raised, I want to say more than 300 million dollars or close to that over X amount of years.

Ivan Bebek: Over 600. Over 600 million as needed. Yeah, so it’s been something that I think if you say, “Ivan, what’s one of the best qualities that you and your team and your partners have achieved?” And I think our ability to finance is number one or two in the world on the expiration side. And the way we finance comes with a lot of strategy and it’s something that always responded in our share prices performing well with a lot of torque to the upside. We get things right. So yeah, it’s a great question and I’m sitting here listening to you talk about the share price pull up and I’m thinking in my head, “What an opportunity.” But why would it sell off, Ivan, if everything is half as good as you’re saying. The stocks should have doubled or been tripling.

And unfortunately the market is never efficient and it’s irrational. And people do paint you when they look at your treasury and say, “Oh you have three and a half million bucks, you’re going to need a lot more to drive this thing forward and give us that big return.” And I’ll be the first to agree.

However, with market cheatings and in a bear market, which we’re about to come out of, the market cheats a lot more than the market does in a bull market. Because it can’t. Meaning people like to sell your stock in advance for financing, look for a discount to the spot price, add a warrant as you said. As a shareholder in other major companies that take major positions, I don’t want warrants in somebody’s company. They’re the worst thing you could possibly do from a company perspective. Not just because people will short your stock. If I have a million warrants of Auryn, which gives me a right to buy shares, but I don’t have to put the money up to buy it, I’ll never watch Auryn’s share price, I’ll never care about performance because I have no risk. I have no skin of the game.

If I have a million shares of Auryn that I bought at a $1.50 per share, I’ve got a $1.5 million investment. I care about it. I hope it does well daily. I tell my friends about it. And that’s the difference with warrants and no warrants. So, we drill really hard lines. We only ever did warrants once in our company in four years. And we did it by, to bring in a gentleman named Ross Biti, one of the industry legends. Incredible founding board for incredible advice. He sold 14 companies, he’s created so much wealth for shareholders, and that cost us a warrant. We bought some of it ourselves. I personally bought a lot of that financing. Not because I wanted a benefit of a warrant. I ended up buying my warrant shares. I bought $3.5 million worth of Auryn shares in the open market in the last four years, including exercising my warrants.

My point to you is, we will not do warrants going forward, number one. The market was offering us a deal a few months ago and it was offering us about 10-12 million bucks. We didn’t need the money. We needed some but not a lot and there was a discount and a warrant to follow that and we said no. We decided we’ll do six million bucks ourselves at a $1.60 Canadian, which was the closing price that day after a big move in the stock, so it was not a sell off, it was the actual market price. And insiders did a million dollars, that was the largest individual purchase by insiders. My dad did a million dollars. One of our largest shareholders bought a million and a half and it went to two other major supportive shareholders.

We did this financing this way, because we wanted to protect the terms. We wanted to be [inaudible 00:46:16] and every time we do a financing it determines your share price performance. So what happened after we did that financing? The share price went to $2.32 per share Canadian. And there really wasn’t any news to drive it. And people say, “Well sure, you got some money and you’re marketing your company.” Yeah, we’re good, Frank. We’re not that good. So I’m assuming that a lot of people anticipated the financing, either sold or shorted, or looked to position themselves as people generally do. They got caught and market ran to $2.32.

Once we crossed two dollars Canadian, which we’re at it right now as we have this call, around $2.05, the game changed a lot. We went to $2.30 and we traded $2.20. We trade a lot of volume just above two dollars. Once we got this news out, a lot of people started buying it but then all this selling pressure came into the stock, and coming back to your point of financing. I’ll tell you right now, we announced Committee Bay drilling, which starts July 7th or 8th and the cost of doing that is $1.9 million Canadian. If we don’t use our existing money, which we probably won’t because we can raise money at a 40% premium to our spot price. The dilution to go drill Committee Bay, and see if we have the solution of the AI, and drill one of the world’s largest gold discoveries in the last two decades, that’s going to cost us less than one percent dilution, 650 thousand shares.

Now, even if we wanted to go deal with the brokerage firms, you don’t go do a financing for 650 thousand shares of dilution in less than one percent of your company with a brokerage firm. The fees would be so punitive on that. So we’ll do it internally. One of our investors, we can’t do it as management, because we get a 40% trade on it above the market. So if you’re at two dollars Canadian you get to raise the money at $2.80. That’s a rule in Canada. Tax benefits for people in Canada and Canadian projects, it’s a positive for us. But we do this one in house. We don’t need to go to brokers to go do that one.

Then you say, “Okay Ivan, that gets you through your Committee Bay drilling, all your Canadian projects have money for this year. What are you guys going to do for the stuff in Peru?” Well we’re waiting for permits so we can drill our own holes and show the world that this could be a massive copper/gold system as advertised as we’re getting closer to go and do. Several CAs have been fined and we worked with Gold Corp when we built the big gold side of our portfolio. They came in at $3.67 Canadian. It was a 23% or 25% premium at our spot to buy at 12.5% interest in our account. The projects we had on the gold side are super appealing and they drill that investment in conjunction with our technical team being super qualified. They’re all from a major technical team in the company.

In the copper world, think way bigger companies than the biggest gold company in the world. Think of a much bigger drought and finding major copper deposits or big copper belt, like we might be onto here, and just think of a much more aggressive crowd to go, and consider taking money from. So I’ll ask you this question, “If we don’t go to market in the next few months, we don’t need money until September. If we don’t go to market, and we do our own financing’s, or we take on a strategic investor, what do you think the market re-rates if we don’t satisfy the market’s demand?” I mean one thing we won’t do is warrants or a discount, but if one of these investors come in at a good premium and we get what we hope for in terms, what do you think the market trade is? I think there would be a spectacular move in the share price and then the muted response that we got on our news a few days ago will get all the traction it can have.

So, the way I like to look at it based on everything I know about the market, and the opportunities we have for capital, which are massive. Way more than the capital we need, whether it’s a strategic major investor comes in or not. We have so many avenues of capital or new investors that don’t short, don’t trade stocks, they just buy you long-term for the bigger business plan. I think it’s a bit of a powder cake. I think that there’s going to be a ton of news coming out of Peru. I think there’s going to be drilling Canada. That’s going to be so exciting on the AI platform. Think about this as an investor, Frank, how about this artificial intelligence. What if you could invest in a company-

Frank Curzio: That’s what I wanted to get into. I was going to finish it off with this. But yeah, talk about AI.

Ivan Bebek: So, let’s talk about AI real quick. Artificial intelligence. How would you like to invest into a company that’s using artificial intelligence to possibly find the cure to cancer? And you say, “Well there’s probably people trying to find … Well I’d love to invest into a company that might figure that out.” And the reason why, and I’m not saying gold mines are anywhere near comparable to cancer but I have to make the point. Artificial intelligence is the future. What it does for us in the mining world is it can compute and twist and manipulate our data, create algorithms a thousand times the capacity of the human brain. So it’s really controlled by inputs. We put a video on our website, it’s on our homepage, aurynresources.com. You can go see how we collected our data and what we put into the computer and the quality of the input is going to determine the quality of the output.

Any kind of incurable disease out there right now, whether it’s baldness or cancer, whatever it may be. You take all the incredibly brilliant scientists that have been working for these cures for years and you take all of the things and you can now run trials milling the trials with an AI platform to train an algorithm to process all these trials to get potentially to a result for a cure. The future of not just incurable diseases. Not just the way we create businesses. Artificial intelligence is going to take over. But mining, one of the most rudimentary, slowest moving businesses in the world, that has had very little technology innovation over time. We’re using drones now to go and fly belts and we’re using cool types of technologies that nothing outstanding, it hasn’t changed much in 20 years.

What we’ve been doing as a planet is we’ve been collecting really good data about the Earth, about the surface, about the rocks, what they mean. To be able to put that into a computer and weigh the different lines of evidence you get on surface takes all that data and have the computer do a thousand algorithms to figure out what is the key that’s indicating where the gold is. If we get that right, as a company, I think with their being no question we may get into mining hall of fame. If we found a major deposit with it we’d be the first ever to use AI. And so you say, “Ivan, there’s seven AI companies in the world. Which one do you use?” We’ve interviewed all of them. Our geologists are from Newmont, the biggest gold company in the world, they’re smart guys.

They said, “How are you doing yours? How are you doing yours?” One of our geologists was the one who created it with a group out of Israel. And if you follow the news, a company called HPX mining just gave this AI company 50 million dollars the other day, U.S. HPX is owned by Robert Freedman, those of you that are unaware, one of our industry billionaires that has created more wealth than most guys have. And incredible mine-finder and mine-builder. He gave them 50 million dollars the other day. The cost of them doing it on Committee Bay, there is no cost. They’re doing it as a pilot program. Why they chose us over a lot of other companies is two reasons. The quality of the data that we’ve collected and we’re imputing is really high. The chance of the AI working is spectacular. Secondly, Committee Bay is a 220 mile long gold belt. There’s 67 high grade occurrences along that belt. That’s the distance from Boston to New York with gold shedding off the surface the whole way across that belt.

There’s a 1.3 million ounce high grade gold, eight gram gold deposit in the middle of the belt and we got to train the AI off the data we collected and off that deposit that was drilled. So now it has been learned at a 99% efficiency to find that high grade gold, that eight gram gold and that 1.3 million ounce deposit, and it gets to incorporate all the other data along the belt to give us targets. We’re going to drill about four targets out of 12, but truly, truly life-changing if that works. While we wait for permits to drill in Peru, Peru has gone past the risk of, “Is it there?” The question now is, “How rich is it going to be?” Is it going to be a $20 billion orebody or an 80 or 100 billion orebody gross value? And how long will you guys be able to hold onto this?

I think that’s a statement that everybody has to have in their mind and everybody has to think about when you think about Auryn. You’ve got to think about torque to the upside of the share price, extremely reduced risk. You’ve got to think a fictitious sell off in the market due to people hoping there’s a financing. We are large shareholders of our company. We treat the company the way shareholders want us to treat it. So that being said, we are anti-diluted and we want to deliver, if we can, a 20, 30, 40, 50 dollar share price to investors. For the first time in my 20 years of doing this, we finally have not one, but two opportunities to achieve that goal for our company. And the most exciting part of that starts on July 7th when the drill starts turning. And then probably mid Q4 when we expect to have drill permits to start drilling in Peru and there’s a few other surprises to come. But we are going into one of the most robust copper/gold markets that I think we’ll see in the last 50 years.

Frank Curzio: Wow. Lot of great stuff there. Right there from you explaining it more. You’re excited but now it seems like everything’s been validated, especially with drilling results. It seems like you were really excited back in March and you’ve been excited for a while. But that’s some really great stuff. And I love the AI thing because I call out people in AI. Just someone makes me look at a company, it was a biotech company that was using AI. AI might be the biggest buzz word. I’m a big technology buff, probably the biggest buzzword in technology history. But what people don’t realize is AI is a matter of you, it only gets better as you input more data, like you said. So, for a small company to say, “Oh, we’re using AI is usually meaningless.” It’s something that you have to continuously put data in there over a long period and it’s going to get smarter and smarter and smarter and help you become more productive.

So the fact that you explain that and how you’re using all this data to actually pinpoint exactly where these things are to increase productivity and lower costs, because a lot of people out there claim to use it and it’s kind of funny when I hear it in the explanations. But you did a great job of explaining why it’s so important.

Ivan Bebek: I appreciate that. I’m a technology buff. I use an iPhone just like everyone else. Or a Samsung, what have you. And the houses are automated. I use Alexa, lighting systems and stuff like that. I’m looking forward to the day that computers can make our lives two more steps easier in the mining world. What’s not happening anymore is all the easy mines have been found. The ones that are sticking out of the ground. Now we have to look under a thin layer of dirt on top of rocks, under cover. And that’s the future of the big mines that everyone’s going to want to be a shareholder in. In a bull market, there’s a lot of drill holes that go at random in a lot of parts of the world and people get lucky and they find big deposits. It used to be, going back 15 years ago that we would go and see five, six kilometers of outcropping gold and it would be like go drill that. And that’s a monster mine, and those were the easy ones.

The future of finding major gold mines is not limited by money. It’s limited by challenge. And the way that challenge is going to get sorted is going to be by using things like AI. And for us, if we’re going to go do something and this is the way we’re going to be going forward in any one of our companies that we ever work with, it has to be a really, really big reward at the end of the drill bit. I know I’m enthusiastic today on your call. I’m always excited to talk to you Frank, but it’s all coming from what’s happening with our projects, the opportunity, the confidence we have is so incredibly high, and the performance year to date is completely indicative to what we’re up to. You look at our pull back, we’re still the top one or two companies in the world performance year to date in the expiration world.

You’ve got to think about that statement. What’s going on in this company? Well I hope today I’ve given a pretty good window into some of the exciting things that are happening for you and your listeners that are listening in.

Frank Curzio: Now be sure to come back a couple months later, give us another update. And I appreciate you coming on. You came on in short notice. I reached out to you, you always reach out to me. Again, good or bad times to give everyone an update, and I know a lot of people own your stock. I’ve had a lot of people request, “Hey, can you get Ivan back on and talk about Auryn.” And I’ll hop on it. So I really appreciate it and sounds like everything’s going well and hopefully you’ll update us in a couple months buddy.

Ivan Bebek: Perfect. Thank you so much. Really, really appreciate being on here. Thank you so much, Frank. Always a pleasure.

Frank Curzio: All right, thanks buddy. All right guys, great stuff from Ivan. Love having him on. Very optimistic. If you’ve listened to him in the past he was pretty optimistic last time. Much more now that these results came in. A few things that stood out, and I want you to focus on things like this guy’s when you’re listening to my interviews. Just little things that they say. I know some of you listeners may be working out, running, or in your car, but if you do have a pen and paper or you have your phone write down some of the things. Because if you listen to Ivan and what he’s been saying about the macro part of gold, he hasn’t been nearly, nearly this bullish. He’s like, “Yeah, it should come.” He said the last window to all gold cheap. That’s a pretty bold statement.

Potential 60 billion dollar asset, 60 billion dollar asset. Incredible. He owns close to 15% of the stock, not him but insiders. So he’s putting his money where his mouth is. Gold Corp owns close to 12%. They established this position in 2017, but with these drill results, and as you know when it comes to these companies with the majors in gold. They haven’t had any major discoveries which can be expected because it’s significantly cut back over the past six, seven years. To avoid bankruptcy some of these guys, even the majors. It’s crazy the amount of debt they have in their balance sheets. A lot of them in a much better position.

But for me, I see him going to some of these majors and I see them signing a deal because now these drilling results definitely made sense. So the stock has pulled back a little bit. I addressed that because they’re going to have to raise money. But the point being is they can probably get money, and he’s an expert at raising money and raising cash and doesn’t give away the fort when he does, which so many other companies have done during this bear market in the resource sector.

But Ivan’s really good at raising cash, and I have a feeling, again, I’m speculating, I have no idea that they could sign on a pretty big partner if the price is right. I’m sure a lot of the majors are looking at this project now after these drilling results. Anyway, great stuff and I love the AI part. The predictability, how they’re actually using it, there not just using AI as, “Hey we use AI.” I just analyzed a company last week from a friend who passed it on to me. A guy that runs a company and it said, “AI capabilities.” And I ripped them apart. I said this is a joke they shouldn’t even put it in there.

The company has no data, they have no one using their technology, and he’s talking about AI. It was horrible. Anyway. You’re seeing how they’re using this technology. You’re seeing why they’re using this technology. How it increases productivity. So a lot of positive things there. Be very careful, don’t go all in, and go crazy. This is still a speculative name. This is the resource sector. Don’t put any money in this that you’re going to stay up at night, and go crazy and say, “Oh wow I can’t believe where it’s going.” No. It should be part of your overall aggressive portfolio. Be smart.

But what I like to see about this name, just like some of the other ones that I’ve given you in this space like Nevada Exploration is the upside potential will be life changing if they nail it. And that’s the risk you have to be willing to take. Put a stop on it. Hey, I’m willing to risk 30%. Maybe you’ll only risk 50%. Maybe you run to risk the whole thing. That’s up to you. I’m not your financial manager. A lot of you think I am sometimes. You’re there with your whole portfolio, “Frank, what do you think of this portfolio?” I’m like, “Yeah okay.” Anyway, but I love what they’re doing. Love what Ivan’s doing. And let me know what you thought of that interview at frank@curzioresearch.com.

Now, let’s get some educational segment. As this past weekend and while my partner’s in town, partners of Curzio Research, and I went to grab a few beers at one of the local bars. This was Friday night. I saw one of my close friends who I golf with, and happens to be a really, really awesome golfer actually. But his brother and father were also in town and he’s a really good friend so he told his dad about me and what I do. And he’s a stock guy as well.

So when I met him he’s asking me, just talking about stocks, and investments and things like that. Again, we’re at the bar just hanging out. Very, very nice guy. And he asked me if I knew this one particular stock. And it happens to be a marijuana stock. And he said, “Have you ever heard of it?” And I didn’t so I said it’s on a ping sheets. And he went on and on about it and how it’s great and I was asking questions. He didn’t know too much about it. I thought he’d know a little bit more about it. And I asked him, I said, “Where’d you get the stock from?” He said, “Some newsletter which he didn’t even know the name of the newsletter.

He basically got an email like the stock, and he bought it. And he said, “Well it went down today. It was up yesterday though. And last week it rebounded, and it was down the previous two weeks.” And he was like, “What do you think, what do you think?” He’s watching the name every single day. And he’s saying it just makes my stomach turn. Now by him saying that what does that mean? Because it’s very simple. And I get this question a lot. And not even questions, but just based on the emails and the tone I see a lot of people have the same problem. And the problem this person has is he has too much money in that one name.

I see so many friends, family members, subscribers who write in. One of my positions fall by 15% I’m getting a ton of emotional emails where, “Frank what do I do with this stock? It’s down 15%.” And this was a good example, is a company called INVITE, which we recommended, and they did DNA testing, and we recommend it. It was such a tiny company, I think it was around seven bucks, and it went to $10 right away. And they did a massive offering to raise money since they were growing really fast. It was a little bit more than I thought. They did a big discount, and push a stock down and then there’s a little bit of a sell off in a period of like two years ago, it was a good month or two where biotech just completely sold off from her favor.

And INVITE got crushed. It fell like $5 a share, and we recommended it at seven. So, we didn’t stop out, but I got several emails that people were really worried, and I’m trying to explain to them that, “Hey, you’re looking at this stock, and I understand getting those emails.” You know, people want an update, and I gave them updates. But today that stock is close to $20 a share. One of our biggest winners in Curzio Venture Opportunities. My point is, I was surprised by the panic, like the emotions. Because when I recommend stocks in my two newsletters, and the stock newsletters Curzio Venture, and Curzio Research Advisory, I buy these names would have 12 to 18-month period.

Of course I analyze it to death. 10 page reports. You guys won’t learn so much from these if you’re not subscribers. Because my job is also to educate you, not just to give you stock picks here, and now. Anybody can give you a stock pick. I want to educate you, help you become better investors. But that’s 12 to 18 month period. That’s why I know the catalyst that I’m seeing, or I outlined, are probably going to come to fruition. And when they do, it’s likely going to push a stock a lot higher. But if you are buying a stock, and you looking at it every single day, every single day. To the point where for falls, five or 10% in a week, you know you’re panicking, you have too much money in the stock. It’s that simple. There’s spread your whisk out. You know, don’t be linked to one stock with 30, 20% of your portfolio is in it.

I think this person said he had about 20% of his portfolio, 25% in his one marijuana stock that’s trading on the pink sheets. Are you kidding me? I mean, sure, look, you could be a millionaire if things work out, but you’re looking at every day. So this is money obviously, that you care about and that you need. And you’re in a situation where you should be throwing money at it, that you don’t care about. Enough money where, hey, if it works out, it’s going to be life changing. But to the point where I’m not going to worry about it, and in fact, I guess he was probably 60s. Dangerous.

So I see this problem happen, and it’s a real easy fix guys. Just diversify. Put less money in your portfolio to the point where you’re not looking at your portfolio every single day, or you look at a specific stock every single day worrying about it. That means you have too much in it. And that’s really big, when it comes to mining, especially Curzio Venture Opportunities, because that is high risk, high reward, those stocks. I’m not going to small mid cap stocks that I traveled around the world to find these ideas, and vista plants and original ideas that you’re not going to find any place else, that I love, that I mentioned like INVITE, or AeroVironment, that I mentioned when we’re up hundreds of percent on these stops, which is really cool. Then they start getting covered everywhere.

But sometimes those things don’t work out, because we’re buying at a very early stage, and we want to limit our risk. But if you’re putting money, and I’ve gotten so many emails like, “This, this, this one or down a ton.” I’m like, “Yeah, but you have these four, or five that are up 200%, 150, 175%. Did you have any?” “No.” Well, try diversify, which we all know. Diversify okay, a billion investment books, whatever, but read about it. But position sizing is important. Make sure you spread out your risk. I mean, if I knew which one stock would go up, I’d give you just one stock. I’d say, “Hey, this is my newsletter. This is my one stop, buy it, and hey, it’s got to go up to three, 400,000%.” Whatever.

But for me, looking at all these stats, if you want to spread out your risk, more times than not, they work out. I have a good history. I have a good track record, the past 25 years, and the way I do this. I made tons of people a lot of money, but sometimes it doesn’t work out. But if one of those things don’t work out, you have 30% on your portfolio, when it’s going to destroy you, it’s going to show your portfolio, then you’re not even going to be in the market anymore. You’re going to hate stocks. You’ve got to think it’s rigged. You’re going to… And it’s all really your fault, because you just put too much money, and usually the one you’re putting too much money too is the best story in guys. I can tell you from doing this such a long time.

The ones who are the best stories are the ones that are going to kick your ass. It’s buying marijuana right now. It’s buying crypto in in January, 2018 were, “Crypto is going up. Everything’s going on 3000%.” That’s when the stories, the best… Nobody wanted crypto. I talked about even marijuana in 2014. We couldn’t sell anything in the promotion when I worked for previous from that workforce. A newsletter industry, I was the only one who wanted to do a promo. I love the research, the industry, sales going to be huge. 2014 nobody, hardly anyone came in. They didn’t care. Today, everybody cares. They love it, because it’s exciting. Everybody’s talking about it. That’s usually the worst time to buy these things. So if you get captured in this story, you’re excited, and you’re putting more money into, guys be careful.

I know it doesn’t make sense, it doesn’t make sense in your brain. But try to make sense of it. Pull back a little bit of money, and be smart. So if it doesn’t work out, you’re not going to just go home, and yell at your wife and be like, “Oh my God, I might have taken another job.” Be Smart guys. Because I see this problem happened more times than not. And is position size, and again, it’s simple fix. Low the amount of money in that one position, where you’re not looking at it every day. And when you look at it a week, or a month, or you’re getting updates from me, and my portfolio, and stuff like that, then that’s when it’s time to either, “Hey maybe we’ll sell it. Maybe we’ll take profits on it.” But don’t look at it every day, because it’s going up and down. Not based on what the company does but what the market does, by what Trump is tweeting.

I mean they bring in all those factors, because you’re looking it, and again, I’m not talking about day trading, day trading is different. You’re looking at it, and you didn’t care what the stock does. You don’t care anything about it. You just looking at patterns. I’m not talking about that. But for me, for my newsletters, buying things for the next 12 to 18 months, and when you look at position sizing, buy as many positions as you can. And if you’re in a position that you’re looking at every single day where you’re emailing me a ton if it goes down, 10% or telling me how I’m the greatest analyst in the world, because it went up 15% a week. That means you get so much money in that one position.

So guys, hopefully enjoy today’s podcast. A lot of cover. I usually wanted to get out of this interview a little bit shorter, but I thought it was fantastic. And then when he started talking about AI, and so many different things. And again, I’m a big fan of Ivan and he does care about shareholders and cares about, just being transparent coming on. So, he’s a good friend. He’s a great guy, and I hope the best for him. I mean I’m investing in the stock I think is going to go a lot higher. I did recommend the, he’s recommended in also our portfolios.

So I know you guys are benefiting, but yet a lot of positives. What I love about it is that if it doesn’t work out, it’s fine. But if it does, you’re going to get paid 10, 20, 30, 40 x. That’s the risk reward you want when you’re investing in resource stocks. You’re not investing 30, 40% to get 50% no, this is something that can be absolutely huge. So from a risk reward standpoint, I really like what he’s doing, especially after the latest drilling results. So guys, that’s it for me. Thanks so much for listening. As always, appreciate all the support. I’ll see you guys in seven days. Take care.

Announcer: The information presented on Wall Street Unplugged is the opinion of its hosts, and guests. You should not base your investment decisions solely on this broadcast. Remember, it’s your money, and your responsibility. Wall Street Unplugged produced by the Choose Yourself Podcast Network. The leader in podcasts produced to help you choose yourself.


Editor’s note: If you’re a fan of Frank’s popular Friday Q&A session, Frankly Speaking, it’s now only for paid subscribers. The great news is, Frank’s offering his monthly newsletter, Curzio Research Advisory, at a fantastic rate to get you in the door. Click here to learn more—and get the details on an incredible 10x opportunity.

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