One of the best performing investment funds

Gold&Discovery Fund return in 2009: +68.91% (after deduction of performance fee)
Gold&Discovery Fund return in 2010: +69.28% (after deduction of performance fee)

Since the fund’s inception in July 2008, the cumulative return is almost 70%. The fund’s NAV is calculated independently by Circle Partners, on a monthly basis. Circle Partners provides these services for dozens of investment funds. Besides this, KPMG checks all accounts at the end of every year. Every week, an indicative NAV is calculated by the fund manager.

See below for the latest fund update. download the January 2012 Report (PDF).

MONTHLY REPORT January 2012

After last year’s major sell-off, there was a global stock market recovery in January. This was limited in Europe (AEX +1.9%), but strong in Canada (CDNX +9.9%). This allowed the Gold&Discovery Fund to gain 17.71%. According to a report by GFMS, gold production in 2011 rose almost four percent. This growth was particularly strong in Africa, and came from relatively small start-up producers. With the current record margins and low valuations, the sector is anticipating a large number of mergers and acquisitions. Glencore’s take-over offer for Xstrata in February, is a prime example. Investment capital is expected to continue to flow into the commodities sector. In a recent survey amongst the very wealthy, half of the group stated an intention to invest in this sector. In January there was a net inflow of capital to the fund, allowing total investment capital to rise to roughly 65 million Euros. Two of the founders have added to their participations in January.

INVESTMENTS

The strongest gains in January came in the rare earth sector (REE). Rare Element Resources (RES), one of our largest positions, led the pack, rising 123% over the month. The catalyst was a press release indicating a large expansion of their REE deposit. Of the exploration companies developing their recent discoveries, Batero (BAT +50%) and Gold Canyon (GCU +42%) performed particularly well. Both are expected to publish their initial resource estimates indicating the size of their discovery. Ghana and Ecuador have unfortunately announced their intention to substantially raise taxes on profits from mining. Kinross, which has major investments in these countries, has therefore underperformed in comparison to its peers. One of our silver positions, Pan American Silver (PAAS), has made a take-over bid for precious metal producer Minefinders, of $1.5 billion. This will ensure production growth for PAAS over the coming years. In the meantime, it hopes to receive permission to further develop its own major silver discovery in Argentina.

VALUE DEVELOPMENT SINCE INITIATION (EUR)

Year	Jan 1	Feb 1	Mar 1	Apr 1	May 1	Jun 1	Jul 1	Aug 1	Sep 1	Oct 1	Nov 1	Dec 1
2008	-	-	-	-	-	-	100.00	101.64	98.65	85.30	61.64	62.21
2009	72.03	82.50	82.28	81.85	81.10	94.37	86.55	97.26	95.41	111.46	112.06	124.51
2010	135.31	129.28	141.80	150.52	165.86	165.11	157.68	152.50	175.22	190.31	203.00	238.01
2011	254.59	231.27	252.40	242.25	246.51	231.90	215.43	222.68	216.32	164.45	189.33	184.83
2012	166.35	195.81	-	-	-	-	-	-	-	-	-	-