Episode 16: Matt Geiger – Private Equity Mining Fund

Matt discusses his company, MJG Capital which has a focus on the natural resource industry exclusively.  MJG is a private equity firm which allows investors to participate in a fund approach vs. direct investing which offers an alternative for investors to gain exposure to the sector in the exact same way, accredited investors are able to participate in other asset classes such as real estate, oil and gas, etc.

Matt’s viewpoint is that investors in Natural Resources should think long term.   His fund will allow redemptions after 10 years which is the lockout period, due to the market cycle this is ideal as the bull market for this sector is in the early stages vs. other sectors which are at the end of their cycle.

Matt feels that the broad hard asset space has bottomed and we are beginning a new bull market. 2017 has been a slower year and a consolidation period. He says their portfolio has done quite well over the last year.

The junior space is where they maintain their focus. He says, “The top 20% of opportunities generate 80% of the returns.” Focussing on tier one assets and management teams is important. For every twenty opportunities, you should only pick one. Some of the top performers were companies that have steadily invested in projects during the slower periods.

He concentrates on a maximum of 25 companies in the portfolio. They get the companies to discuss their management plans and then monitor them very carefully. Being selective is important. Half of their purchases are in the open market, and the other half is in private placements. They evaluate placements by looking at the company from the bottom up, and they look for a full warrant vs. a half warrant.

He sends out a report on the sector and the funds performance twice a year. If you’re interested in learning more about MJG and the performance of his funds, feel free to visit his website via this link.

Talking Points From This Week’s Episode
• Matt outlines how his limited partnership resource fund works.
• They take a very long-term view of the resource market
• Primary focus on the best of the best juniors.
• Look for investments with private placements and full warrants.

About Our Guest

Mr. Geiger is Managing Partner at MJG Capital which is a limited partnership specializing in long-term natural resource investments. They adhere to bottom-up security analysis and maintain a long-only portfolio of resource equities. The partnership adheres to a bottom-up security analysis within the context of four ongoing macroeconomic themes: global food scarcity, global fuel/energy scarcity, regional water scarcity, and the emerging world’s infrastructure build out. Their holdings include explorers, developer and producers of energy, industrial, precious and agricultural minerals and metals.

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