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-- Posted Wednesday, 1 December 2010 | Digg This Article | | Source: GoldSeek.com
MONTHLY REPORT AS OF NOVEMBER 30, 2010 PERFORMANCE: ONE MONTH / TWELVE MONTHS % CHANGE | PRICE NOV. 30 | 1 MONTH | 12 MONTHS | THE TIMELESS PRECIOUS METAL FUND (EUR) | 16.78 | +21.3% | +69.6% | THE TIMELESS PRECIOUS METAL FUND (USD) | 21.81 | +13.3% | +46.9% | GOLD | 1383.60 | +1.8% | +28.3% | SILVER | 28.02 | +13.3% | +52.1% | PLATINUM | 1646.00 | +0.9% | +14.6% | PALLADIUM | 699.00 | +13.4% | +92.0% | GOLD & SILVER INDEX - PHILADELPHIA ($XAU) | 210.80 | +4.4% | +16-0% | AMEX GOLD BUGS INDEX ($HUI) | 550-00 | +5.3% | +15.9% | GOLD MINERS INDEX - AMEX ($GDM) | 1641.23 | +4.0% | +16.9% |
The NAV of THE TIMELESS PRECIOUS METAL FUND increased 21.3% in November 2010. The price of gold moved up by 1.8% only while the price of silver rose by 13.3%. Gold and silver indices representing major companies also went up 4.6% on average over the past month. Junior gold and silver mining shares – the domain and focus of THE TIMELESS PRECIOUS METAL FUND – outperformed the major indices again. The two Platinum Group Metals, Platinum and Palladium (the six platinum group metals (PGM's) are platinum, palladium, rhodium, osmium, iridium and ruthenium) showed a mixed performance: the price of platinum only rose 0.9% while the palladium price jumped 13.4% over the one-month period. The price of palladium has increased 86.5% over the past twelve months. The “McEwen Junior Gold Index” increased 41.6% in 2009 while the NAV of THE TIMELESS PRECIOUS METAL FUND surged 178.7%. Why this amazing difference? The constituent companies of the Index are selected by a committee using the following criteria: - Minimum market capitalization of US$50 million
- Minimum daily trading liquidity of US$50,000
- Listed on the TSX, TSX-V, NYSE, NYSE.A, NASDAQ
- No commercial production
The main difference between this index and THE TIMELESS PRECIOUS METAL FUND can be seen in point 4, as we invest 70% of the assets in producing companies or companies which are close to going into production. The following chart shows clearly to what extent junior gold mining companies are still undervalued in relation to the price of gold, a situation which will not last and which demonstrates that junior gold stocks have a lot of up-side potential left. 
TOP FIVE GOLD HOLDINGS 1. GOLD RESOURCE - 9.6%2. PMI GOLD - 8.6%3. MAUDORE MINERALS - 5.4%4. CENTRAL ASIAN MINERALS - 4.5%5. MINERA ANDES - 3.3% TOP THREE SILVER HOLDINGS 1. ARIAN SILVER - 6.1% 2. GREAT PANTHER SILVER - 5.9% 3. SILVERMEX RESOURCES - 4.1% Through the merger of Silvermex with Genco, Silvermex has replaced Endeavour Silver in the list of our three top holdings. Gold Resource regained the number one spot among our gold stocks as the company declared another special dividend of 3 cents for the month of November. THE TECHNICAL OUTLOOK FOR GOLD 
Over the course of the 2008 correction, the HUI Gold Bugs Index dropped to the 2002 level, when an ounce of gold traded at between $ 250 and $ 350, but has since regained more than 200%. Gold stocks are now outperforming gold but remain undervalued, especially the junior gold and silver stocks. The GOLD/GOLD BUGS INDEX RATIO now stands at 2.6 while a normal level before the run-up early 2008 was 2. A ratio of two would mean an index of 685 points based on today’s gold price. The technical indicator shown below tells one thing: It is easy to see the future in a chart which shows the past and the future until today. The real question is: Today, are we at a peak or are we moving much higher? – We believe that this Index will move towards 10 and possibly higher in the near term.  EXPLORATION – RESOURCES – RESERVES- PRODUCTION Mining companies create value through carrying out exploration programs, discovering mineral deposits and bringing them into production. As the table below shows, close to 65% of the companies in the portfolio are in production or near production. About 20% of the companies have not made the decision to go into production despite having substantial mineral reserves (NI 43-101). Their aim is to prove up a substantial reserve/resource in the hopes that one of the majors will take them over – at a substantial premium to the cost of exploration. About 3% of the portfolio is presently held in cash. You may notice that only 34% of total assets are presently invested in producing companies. Many that are listed under “Towards Production” will actually start commercial production within the next three months.
HEDGING STRATEGY As most of our investments are in CAD, USD and AUD but the NAV is calculated in EUR, we hedge our currency exposure when appropriate.  
The EUR is under pressure again as Ireland and Portugal struggle to avoid insolvency.
How to invest? Go to: http://www.timeless-funds.com/en/timeless-precious-metal-how-invest The spectacular performance we have seen in the Fund over the past 12 months is partially due to the fund’s particular timing and focus and partially due to market conditions. Still, it is not the end of growth for this market sector. Global demand continues driving the price of gold. As production cannot be increased at will to follow demand, the price of gold has to go up. There are many junior gold and silver companies that still offer impressively low valuations, trading at market capitalizations of $25/ounce of gold or less. Junior gold stocks will continue to outperform gold and the major gold producers as well as stock markets in general. Major US Stock market indices all lost value over the past decade while the price of gold went from $ 250 to $ 1,380, up 450%. Several junior companies have recently been bought by competitors that paid between $ 50 and $ 150 for an ounce of gold in the ground.
NOVEMBER 30, 2010 FACT SHEET | http://www.timeless-funds.com | ISIN : | MT0000072612 | Swiss Security N° : | 1921952 | Investment Manager: | P. ZIHLMANN INVESTMENT MANAGEMENT AG, Zurich, Switzerland | Currency: | € | Domicile: | MALTA (EU) | License: | July 16, 2004 | Size (November 30, 2010) | 24.2 Million € | Custodian Bank: | Bank of Valletta, Malta | Administration Company: | Valletta Fund Services, Malta | Auditors: | PriceWaterhouseCoopers, Malta | Legal Advisors: | David Griscti & Associates, Valletta, Malta |
VISIT OUR WEBSITES: www.timeless-funds.com OR www.pzim.ch REGISTER NOW AT: register@pzim.ch TO RECEIVE OUR RECOMMENDATIONS OF STILL-UNDERVALUED JUNIOR GOLD AND SILVER COMPANIES.
-- Posted Wednesday, 1 December 2010 | Digg This Article | Source: GoldSeek.com
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