Analysts Still Have High Conviction in BlackRock Mining

Following the collapse of holding London Mining, Morningstar closed-end fund analysts have downgraded the trust's rating from Gold to Silver, but still hold the fund in high regard

Emma Wall 16 October, 2014 | 12:05PM
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It has been a bad week for BlackRock World Mining (BRMW). Last week the trust was forced to write off a significant investment worth $110 million, causing the share price to tumble.

The investment was a royalty bought from London Mining in 2012, linked to its Marampa iron ore mine in Sierra Leone. Though BlackRock did the necessary due diligence into London Mining what the company could not have foreseen was the ebola virus – which has brought all trading, transport and industry in the region to a standstill.

The royalty was linked to one single mine – the value of which had already received a bashing thanks to the depressed iron ore price, and the fact that giant miners such as BHP Billiton were producing much better quality iron ore from mines in Australia.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
BlackRock World Mining Trust Ord502.71 GBP-5.51Rating

About Author

Emma Wall  is former Senior International Editor for Morningstar