To my knowledge, there is no index in existence today that measures junior mining companies focused on industrial metals. I have decided to construct my own called the Industrial Minefinder™ Junior Index (IMJI™). I launched a website for it today to establish my intellectual property rights to this concept.
The Industrial Minefinder™ Junior Index (IMJI™) is an index that tracks junior mining companies engaged in the exploration and development of industrial metals.
The IMJI™ will initially target 65% of its holdings towards juniors focused on the primary base metals — copper, zinc, nickel, and lead. The remaining 35% of holdings will target juniors focused on other major industrial metals, such as aluminum, iron, silver, lithium, manganese, molybdenum, platinum group metals, scandium, tin, titanium, uranium, and vanadium.
The following chart shows the initial constituent categories of the IMJI™. It reflects my preliminary expectations for what percentage of each of these metals will be represented in the index:
These categories will be periodically reviewed and adjusted in the future to reflect ongoing market dynamics. Please note the following concerning these categories:
- Though each one is relatively small (5% each), silver, lithium, platinum group metals, and uranium will initially have their own designated categories. This reflects the fact that each of these metals has a significant group of active junior miners and are a common focus of resource investors.
- Although the markets for aluminum and iron are both about the size of the copper market, these do not have their own designated categories because they tend to be dominated by a few very large producers and there is less of a junior market.
In the near future I will be publishing holdings on the IMJI™ page on this website. I am going to release them in metal groups, starting with zinc & lead, then copper, and then nickel. I hope to have the full holdings for the index published by the end of Q2 2018. These will then be periodically updated to keep the index inline.
The IMJI™ will not be an index that holds every single junior miner involved in industrial metals, but rather will focus on a more select group of companies that are engaged in developing quality deposits across the spectrum of industrial metals. Preference will generally be given to companies with:
- established 43-101 or JORC Resources
- larger market capitalizations
This will help ensure that the index:
- reflects actual deposits of industrial metals that reflect potential development opportunites
- represents a more liquid set of potential opportunities for investors looking to gain exposure to the sector
At this point, I am envisioning the full set of IMJI™ holdings will include somewhere between 50 to 100 companies.
I expect the IMJI™ to be a useful tool for analyzing certain aspects of the junior mining industry and the broader industrial metals sector in general with insights ultimately providing a distinct advantage for Industrial Minefinder™ subscribers.
I envision analysis initially focusing on the following:
- Performance tracking of the broader index and the underlying metal categories. This will provide an interesting benchmark for myself and other industry participants.
- Merger & acquisition activity within each metal category. I suspect that the tracking of this index will help signal when surges of deal flows are coming.
- Size, grade, type, and jurisdictions of deposits. I anticipate that the comparison of these variables to performance will provide unique insights.
Open to Collaboration
Finally, I am open to collaboration with individuals and/or industry participants who are interested in providing:
(1) sophisticated technological assistance for tracking the index and publishing it on this website
and / or
(2) financial contributions that can be used to hire sophisticated technological assistance and/or generally promote the index to support capital investment into the junior mining sector.
I welcome your comments and suggestions below.
Joshua Hall, ChFC