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John Tumazos Advisory and Compensated Research, LLC (JTACR) will provide fundamental research support services concerning particular emerging companies, primarily developers of minerals deposits, for professional institutional investors. The primary function or role of JTACR will be to provide fundamental research analysis on specific companies in which, John Tumazos Very Independent Opinions, LLC (JTVIO), which is a separate investment advisor, cannot write because it received compensation for certain corporate advisory functions. In 2007, John Tumazos Very Independent Research, LLC (JTVIR) was registered with the State of New Jersey, to provide research services. JTVIR conducts fundamental demand-supply microeconomic studies of individual commodities markets such as aluminum, copper, nickel, steel, gold, containerboard, wood, paper or other industrial materials including written commentary or excel spreadsheets. JTVIR writes company commentaries on large industrial materials producing companies, including text and excel spreadsheets of earnings, underlying driver variables, cash flow, balance sheets or related relevant data. In May 2011, JTVIR covered 38 stocks with average market values of about $30 billion each. Once JTVIO, has accepted compensation for advising a company, JTVIR cannot write research as “independent” owing to the compensatory relationship. Hence, the “independent” nomiker creates an effective “black out” after compensation, which denies our buy-side institutional clients from follow-up. For example, in April 2010 JTVIR wrote a research report on Paramount Gold and Silver after visiting its Mexican mineral property. In June 2010 JTVIO delivered a fairness opinion in Paramount Gold and Silver’s acquisition of a X-Cal Resources’ Nevada gold and silver property, and accepted $60,000 in compensation. On December 9, 2010 Paramount Gold and Silver published a 43 foot drill-intercept of unusually large gold and silver values at “Don Ese” zones at its Mexican location, worth over $1,000 per ton, suggesting over 90% pretax margins from its future mining of those zones and Paramount’s shares doubled. The 2011 registration of JTACR provides a format for “non-independent” research where it is warranted after accepting compensation and completing an assignment. UNDER NO CIRCUMSTANCES WILL JTACR OR JTVIO ACCEPT COMPENSATION TO WRITE A RESEARCH REPORT PER SE. Instead, we envision situations after which JTVIO advised a publicly traded company in a merger or acquisition, joint venture or capital raising where the publicly traded company continued to have its own investment appeal afterwards. Over time, several new companies may be added each year to the JTACR coverage. We expect it will resemble “an emerging growth smaller capitalization mining” universe where many companies have market capitalizations under $1 billion and average < $1 billion.
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Copyright © 2011
John Tumazos Advisory & Comensated Research, LLC
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