The Hardman & Co Monthly: May 2024
Feature article: Is silver the cheapest asset on the planet?Silver is a precious metal, a monetary metal and an industrial metal with a surprisingly wide range of uses. It’s not that well understood by investors and tends to get overshadowed by gold – but, perhaps, not for much longer.
We think that the provocative title of this article is justified by silver’s attractive fundamentals. The “official figures” from the Silver Institute estimate that the silver market has been in deficit for the past five years, and the deficit is increasing
Silver supply from mining is relatively inelastic, as new mines can take at least 10 years from discovery to commissioning. Identifiable above-ground stocks in London, the US and Shanghai, have been in sharp decline since 2020.
Photovoltaic demand for silver in solar panels exploded in 2023 and, in our opinion, is substantially underestimated in the official figures. Based on our analysis, the deficit for silver is bigger than the consensus believes
We expect that a shortage of silver will emerge going forward. In the meantime, the gold/silver ratio stands, currently, at 85x, making silver look cheap in a historical context. During the past century, it has been highly volatile in a range of 15x-20x during the peaks in gold/silver bull markets to more than 100x for short periods.
Advanced Oncotherapy is focused on providing radiotherapy systems for cancer treatment through the use of a proton therapy technology. Co. operates in two business segments: proton therapy and healthcare related properties. The healthcare related property U.K. segment relates to Co.'s property in Folkestone, which is being marketed for sale.
Apax Global Alpha is a closed-ended investment company that invests in a diversified portfolio of private equity funds and derived investments in debt and equities. As of Dec 21 2017, Co. targeted an annualized Total Net Asset Value Return across economic cycles of 12-15%, net of fees and expenses. Co.'s investment activities are managed by Apax Guernsey Managers Limited (the Investment Manager) under a discretionary investment management agreement. The Investment Manager obtains investment advice from Apax Partners LLP (Apax Partners). Apax Partners advises on investments globally in companies across four sectors: Tech & Telco, Services, Healthcare and Consumer.
Arbuthnot Banking Group is primarily involved in banking and financial services. Co. is organized into three main operating segments: Retail banking (associate), which incorporates household cash management, personal lending and banking and insurance services; U.K. Private banking, which incorporates private banking, commercial banking and wealth management; and Group Centre, which is comprised in Co.'s Group Centre management. As of Dec 31 2016, Co.'s total assets were £1.27 billion.
Chesnara is a holding company, engaged in the management of life assurance and pension policies. Co.'s segment are CA, S&P, Movestic, and Waard Group. The CA segment is part of Co.'s U.K. life insurance and pensions run-off portfolio. The S&P segment is responsible for conducting both unit-linked and non-linked business, including a with-profits portfolio. The Movestic segment is responsible for conducting both unit-linked and pensions and savings business and providing some life and health product offerings. The Waard Group segment provides life policies, although also includes unit-linked policies and some non-life policies, covering risks such as occupational disability and unemployment.
City of London Investment Group is the holding company for a number of subsidiaries. The principal operating subsidiary is City of London Investment Management Company Limited, which acts as an investment manager on 38 accounts with a total of £3.58 billion under management as at June 30 2017. Co. is an asset management group with an institutional client focus specializing in Emerging Market closed-end fund investments. Co.'s range also include Developed, Frontier and Global Tactical Asset Allocation closed-end fund strategies.
H&T Group is a holding company. Through its subsidiary, Harvey & Thompson Limited, Co. is engaged in pawnbroking, gold purchasing, retail of jewellery, cheque cashing, unsecured lending and other related services.
ICG Enterprise Trust is an investment trust. Co. is a private equity investment company focused on buyouts in developed markets. Co. invests in private equity funds and also directly in private companies. As of Jan 31 2017, Co.'s total investment portfolio amounted to £594.3 million.
Shield Therapeutics is a specialty pharmaceutical company focused on the development and commercialization of late stage, hospital-focused pharmaceuticals which address areas of high unmet medical need. Co.'s key products are Feraccru®, commercially available for the treatment of Iron Deficiency Anaemia, and PT20, for the treatment of systemic phosphate accumulation (otherwise known as hyperphosphatemia). Co. has an additional pipeline of three prescription pharmaceutical assets (PT20, PT30 and PT40) with commercial synergies.
Volta Finance is a closed-ended investment company with the objective of investing, among other asset types, in the following main asset classes: Collateralized Loan Obligation, Synthetic Corporate Credit, Cash Corporate Credit and ABS. Co. has appointed AXA Investment Managers Paris S.A., as its Alternative Investment Fund Manager to manage the investments of Co.
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