Osisko Gold Royalties Ltd. says it has confidence in its recent acquisition of a stake in Labrador Iron Ore Royalty Corp., even if its shareholders don’t quite know what to make of the investment at a time when the metal’s price languishes near half its value of a year ago.

“We understand that there are cycles and ‘buy low, sell high’ is easy to say but hard to do,” said Osisko CEO Sean Roosen.

“In this case and time, when everyone is running for cover, that’s when we want to wade in. I think we bought it right.”

Osisko announced Friday in its quarterly earnings release that it has amassed a 9.75 per cent interest in Labrador Iron Ore Royalty since the start of the year.

“The way we look at this, this gives us a relatively low-risk access to short-term dividend cash flow and that helps us with our numbers,” said Roosen.

Osisko is a mining royalty company, meaning it has agreements giving it the right to a share of income from mines operated by other companies.