MARKET
The Market of Gold
Industry overview
Gold’s diverse uses, in jewlery, technology and by central banks and investors, mean different sectors of the gold market rise to prominence at different points in the global economic cycle. This diversity of demand and self-balancing nature of the gold market underpin gold’s robust qualities as an investment asset.
Q1 2025 Key Developments
Gold is a commodity that has always stood apart, but there have been recent market developments that build on its existing differentiators while illustrating the importance of its role in a portfolio.
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The commodity reflation trade is in full effect, which can negatively impact risk-on assets and could suggest a larger allocation to gold.
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Gold’s weight in commodity indices is increasing, and should continue to increase for a strategic allocation.
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Gold’s volatility has been stable despite the variability in equities, bonds, and alternative assets.
STABLE COMMODITY
-A TRADITIONAL HEDGE AGAINST INFLATION
Price discovery is crucial for any market. Gold not only has a spot price, but it also has the LBMA Gold Price, as well as several regional prices. The LBMA Gold Price is used as an important benchmark throughout the gold market, while the other regional gold prices are important to local markets.
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This data set provides the gold price over a range of timeframes (daily, weekly, monthly, annually) going back to 1978, and in the major trading, producer, and consumer currencies.
Investors access many commodity markets via futures contracts. Futures contracts are based on expectations of future prices, the cost of carry and interest rates, investors are exposed to an additional source of variability: the shape of the futures curve. When the futures curve is upward sloping (futures prices are higher than spot), which is typical for gold, it is said to be in contango, which generally reflects the cost of carry. COMEX (operated by CME Group) and LME precious are key market centres for gold futures trading.
Reflation is good for commodities and could be even better for gold
The current global economic landscape indicates improving economic conditions, higher inflation and rates expectations, as well as commodity supply shortages which are likely to support commodity performance. This is reinforced by the fact that investors are increasing their allocation to commodities.1 While broad-based commodity investments are often used as a source of returns and diversification, the benefits tend to be tactical.
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Our analysis suggests that gold is still the most effective commodity investment in a portfolio as it continues to stand apart from the commodities complex. It deserves to be seen as a differentiated asset as it has historically benefited from six key characteristics:
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It has delivered superior absolute and risk-adjusted returns to other commodities over multiple time horizons
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It is a more effective diversifier than other commodities
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It outperforms commodities in low inflation periods
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It has lower volatility
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It is a proven store of value
A STRATEGIC ASSET - A PERFECT TIME TO CAPITALIZE
Gold benefits from diverse sources of demand: as an investment, a reserve asset, a luxury good and a technology component. It is no one’s liability; it carries no credit risk, and it is scarce, historically preserving its value over time.
Gold can enhance a portfolio in four key ways:
1. Generating long-term returns;
2. Acts as a diversifier and mitigates loss diverse markets;
3. Provides liquidity with no credit risk; and
4. Improves overall portfolio performance.
From the period of 2011-2019, the majority of the financing in the junior mining sector has been in gold producing assets and companies with a market capitalization of under $100 million.
C3Bullion focuses in public companies trading in the TSX/TSXV to minimize investment risk.
Better returns, effective diversification Outperforming commodities
Gold has performed broadly in line with the S&P 500 over the long term, delivering average annual returns of 10.8% since the elimination of the gold standard in 1971 and a compound annual return of 7.9% .
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But when compared to commodities, gold has outperformed not only broad-based indices but sub-indices and most individual commodities too. Nearly all sub-indices have fallen over the past five years. But gold has risen during that time. Gold has also outperformed major commodity sub-indices over the past 10 and 20 years (Chart 3), and outperformed most individual commodities, many of which have delivered negative returns in recent decades.
We have connectivity throughout the Americas to locate projects
The Mining sector is currently facing limited management consulting and lending alternatives and C3Bullion aims to capitalize on it.
Optimal future capitalization with AI
The AI model, in course of development, is designed to be sufficiently complete and comprehensive for capturing data on mining projects worldwide with an evaluation of risk factors components consistent with C3’s expert judgment. The risk factors included in the model are proposed and reviewed based on the expertise and judgment of mining and finance professionals from C3 ensuring that only relevant inputs are considered within the structure of the model.
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C3’s AI model is a statistical process that consists of grouping a weight optimized set of relevant mining and financial aspects considered characteristics of a mining project. This information will be stressed under different conditions to create risk scenarios, which will provide the optimized level of accuracy for the model, as measured by comparing the stressed scenarios with a benchmark/archetype scenario established by C3.
The model combines expert judgment with a statistical approach, providing:
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A verified and optimized model that provides transparent and objective risk assessment consistent with mining expert judgment.
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Leveraged intuition of mining and financial professionals to ensure that the model is applicable for financially viable mining projects.
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Enhancement to the risk metrics and model discriminatory capacity to select between mining projects with acceptable and non-acceptable level of risk.​
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A systematic data collection to consolidate an empirically driven model.
The management consulting Process
Aside from the mine development stage or size, C3’s management team will perform a risk/operational analysis assessment of each mine before providing management consulting services and any equipment, machinery, plant or property lending.
For example, the following represents a short list of some of the project characteristics that C3’s team analyzes:
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Gold concentration per ton
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Feasibility studies analysis
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Current and future daily production processing capacity
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Political risk analysis
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Production cost analysis
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Employees cost analysis
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Licensing and concessions analysis
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The mine’s management assessment
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The mine’s debt levels
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The mine’s production equipment assessment.
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This list is not exhaustive, as every mining project is different, but C3 will rely on the extensive experience of its management team who have operated mines over the last 30 years throughout the world.
Our Project Criteria
Targeted projects are focused mainly on public companies trading in the TSX/TSXV with geographical locations in North and Latin America. C3Bullion will consider Australia and Developed Europe on an opportunistic basis.
Target investment size of $1M - $5M per transaction, $2-3M investment on average.
Criteria Continued...
The AI model, in course of development, is designed to be sufficiently complete and comprehensive for capturing data on mining projects worldwide with an evaluation of risk factors components consistent with C3’s expert judgment. The risk factors included in the model are proposed and reviewed based on the expertise and judgment of mining and finance professionals from C3 ensuring that only relevant inputs are considered within the structure of the model.
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C3’s AI model is a statistical process that consists of grouping a weight optimized set of relevant mining and financial aspects considered characteristics of a mining project. This information will be stressed under different conditions to create risk scenarios, which will provide the optimized level of accuracy for the model, as measured by comparing the stressed scenarios with a benchmark/archetype scenario established by C3.
The model combines expert judgment with a statistical approach, providing:
​
-
A verified and optimized model that provides transparent and objective risk assessment consistent with mining expert judgment.
-
Leveraged intuition of mining and financial professionals to ensure that the model is applicable for financially viable mining projects.
-
Enhancement to the risk metrics and model discriminatory capacity to select between mining projects with acceptable and non-acceptable level of risk.​
-
A systematic data collection to consolidate an empirically driven model.
We know where the Optimal Deal is Located
Completed NI43-101 or JORC Resource statement, Preliminary Economic Assessment (PEA), and / or Feasibility Studies.
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Stage of Development: Pre-production or near-production development stage with permitting in place.
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Lending Mechanisms:
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1. Convertible debentures
2. Streaming and Royalty opportunities
3. Senior secured debt
4. Opportunistic equity investments
An experienced and dedicated advisory team
C3Bullion has a Board of Directors and strong Management Team with over 150 years of natural resource experience.
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C3Bullion has recently hired a strong Advisory Board composed of senior geologists, mining experts, and finance managers who have decades of experience in the operation and management of precious metals mines. C3Bullion has a successfully appointed advisors with strong mining and commodities backgrounds. The C3 Bullion technology platform will be led by seasoned experts in the industry.
We have the Project Targets
When the Company’s committee is given instructions to conduct diligence, they will spend two weeks analyzing the available data on each project.
We will then determine which project fits closely to the criteria of the Company outlined above, engage in discussions with the project’s management, and schedule a “boots on the ground” visit to the operating mine.
This initial process is expected to take 30 days.
During the following 30-day period, our management will visit the project site, and examine all necessary operating protocols of the mine including:
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inspection of equipment
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inspection of ore processing procedures, mine safety standards, drill core samples, and all available technical data on the exploration phase
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interview personnel, review corporate financial data, take samples of unprocessed and processed ore, and have it analyzed in a laboratory
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review permits
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consult with the community and local officials
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conduct additional reviews where it is deemed necessary
Gold...forever valuable, forever our Model
Gold mining is a global business with operations on every continent, except Antarctica, and gold is extracted from mines of widely varying types and scale.
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Mines and gold mining operations have become increasingly geographically diverse, far removed from the concentrated supply of four decades or so ago when the vast majority of the world’s gold came from South Africa.
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China was the largest gold producer in the world in 2016, accounting for around 14% of total annual production. But no one region dominates. Asia as a whole produces 23% of all newly-mined gold. Central and South America produce around 17% of the total, with North America supplying around 16%. Around 19% of production comes from Africa and 14% from the CIS region. See our interactive gold mining map for gold production per country in 2023.