Industry Reports

We were pleased with the appreciation results of our precious metal developer picks in the first quarter of 2009. While the quarter end appreciation average was about 52%, for each pick the closing price at the end of March was not the high for each company in the first quarter, and each high was above the closing price for 2008. Resource developers require effective credit or capital markets and bear a higher than average amount of risk. The absence of willingness and ability of banks to lend or invest in November and December of 2008 pushed resource developers to extreme lows regardless of their underlying assets or management’s success in creating value. This was, no doubt, exacerbated by the “January effect” or tax loss selling.