A: I quite like Deterra Royalties (DRR), which was spun out of Iluka Resources in November 2020. Its major asset is a royalty stream over Mining Area C in the Pilbara, which is mined by BHP.

It is, however, a bit of a play on iron ore being sensitive to iron ore prices, production volumes, and the exchange rate. Somewhat surprisingly, it has drifted lower since the ASX listing, notwithstanding the increase in iron ore prices.

The broker analysts like it – 4 buys and 1 neutral, a target price of $4.95, 14.3% higher than the last ASX price of $4.33. Broker range is a low of $4.50 to a high of $5.50. Yield is attractive – a forecast 2.7% this year, rising to 5.2% next year. Should be fully franked.