Check the part about Altius The Next Bull Market Move Interview - Live from London - Collin Kettell, CEO & Partner, Palisade Global Investments Ltd.
Last week I was very fortunate to meet up with Collin Kettell in London while he was traveling through Europe. We discussed his early background, what he looks for in a resource company, the companies he’s bullish on, and what might be next for Gold.
Welcome back to The Next Bull Market Move Collin. How are you today?
I’m good Kerem. Nice to finally meet you in person. It’s nice being down here in London with you.
Yeah. You too. So what brings you to London?
Well I’ve just done a weekend scotch whisky tour in Ila with my grandfather that I’ve been planning for a couple years. It’s quite a bit of fun and a nice break away from work and figured I’d stop in London to have some meetings on the way home.
Great. Let’s start with a bit of your background. People mainly know you via your show Palisade Radio, so how did you get started with Palisade Radio? And how did you get involved in the mining resource sector?
Yeah. My background in mining goes back to a young age. My dad was in the resource space starting when I was about 10 years old. A long story short, I saw a fantastic amount of money being created in a way that allowed for a very interesting lifestyle not tied down to a 9 to 5 kind of arrangement, and it kind of caught my attention as a young, budding entrepreneur.
It’s a space that you can make a lot of money if you catch the cycle right and, there are a lot of different avenues to go about making that money. So coming out of school I decided to start Palisade Global with my business partner, Sean. And that was about five years ago. So we’ve had a fairly successful track record so far.
The first three years we were in the depths of the bear market. And about two years ago of course we had the first leg of the bull market that started, so things really got more fun. I think it goes without saying that the most fun time you have during a resource market is during the bull market portion.
So Palisade Radio came about four or five years ago as well. And that was my attempt to put a platform out there where people could go to and get content on the resource sector in specific. And it also allowed me to network with some of the brightest minds in the space and all of the people that we have on the show from time to time.
Let’s talk about gold. Over the last couple of months when we last did an interview, it was consolidating and it seems to be still consolidating at the current levels of around $1,300 to $1,350. So what are your views on gold for the rest of the year?
I think if you take a chart of gold and you look at it on a one year time horizon, what you’ll find is actually a very compelling chart. It is consolidating but it’s consolidating in a very upward and obvious pattern. So long as gold remains above the 1,300 mark or somewhere close to that, that upward pattern will continue. And I think that we’re getting closer and closer to a point where it’s gonna break out of that pattern to the upside.
The other interesting thing I’ll point out is that last year, while the junior resource stocks did not perform that strong, in fact most of them kind of slid on a downward path, the commodities as a whole had a very strong year.
And so mix into the fact that retail investors, like we were talking about earlier, are bored with the space…They’re a very impatient group if they haven’t seen moves for two years, the fact that these stocks are down the same time as commodities are up, I think we’re gonna be in for a very exciting second half of the year.
So what do you look for in a resource company? What requirements do you look for?
I think this can result in a very generic answer, because most people will say that they look for the same thing and I would be in that camp. The most important one is gonna be management, of course. And you know, as we were having a discussion over lunch, Kerem, talking about the problem, the inherent problems that exist in the resource space - often times management doesn’t own very many shares of the company and yet, junior resource stocks are kind of like a fiat currency in that you can very quickly dilute them.
These companies always need to raise money. They’re not revenue-generating. And so, as an investor coming in, you like to think or try to ensure that your value creation is in line with management. Management often won’t own any stock or a very little bit. And through options they can reincentivize themselves at the same time as your share position might get cut in half. So, making sure that management and the decisions being made are in line with shareholder value is very important for me.
Beyond that we’re looking for ideally exploration or development-stage projects that have value that can be unlocked. And we’re all so very in tune with the cycles that are playing out. You’re gonna wanna look for companies maybe that have the rubber band type effects, and every time that the bull market kicks into action, you will see a huge move in the stocks. So there’s a variance of different factors to look for, but I think management has to top the list.
Interesting. So can you give us an update on Goldspot Discoveries and New Found Gold Corp?
Sure. Goldspot Discoveries is a leading machine learning and artificial intelligence company in the resource space. And we’ve certainly solidified ourselves as the leading group of experts that are applying machine learning to the big data problem that exists in the resource space.
To put this very simply, a company, a big mining company, has terabytes worth of data and only a handful of geologists that are supposed to go through and understand that and interpret that data and then select which data is important and make very expensive decisions based on that. And we live in an era now where computers are getting cheap enough and fast enough to more intelligently analyze and implement the data that’s out there.
So Goldspot’s got an all-star team in terms of management and geoscientists. We have 14 full-time geoscientists on board and we’ve got clients, including Hochschild, Sprott, McEwen, Yamana, just to name a few, that are utilizing our team to take their big data and interpret it better. Goldspot’s set to go public in the next three months and we’re very excited about that.
And New Found Gold is the second largest landholder in all of Newfoundland and Labrador. We also have a flagship project in Ontario, very much focused on gold exploration on a massive scale. And what that means is we’re not just looking for one million ounce deposits. We’re looking for multiple deposits across trends. And we’re very enthusiastic about the assets that we’ve accumulated in the company over the last couple of years.
Altius Minerals announced last month that they had signed an LOI with New Found that’s going to see us go public with somewhere between seven and a half and ten million dollars in cash. And that’s gonna put us on the path to be the leading vehicle for investors seeking exposure on gold exploration in Newfoundland.
Most people don’t know but Newfoundland’s been one of the few places that’s had a staking rush over the last year and a half. And there’s a lot of companies that have moved into the space. It’s still very fragmented and I think a company that secures a large land position like New Found is gonna be very attractive for investors.
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Great. Okay. Thank you very much for your time, Collin.
Absolutely. Thank you, Kerem.