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Why Stanley Druckenmiller Dissolved His Position in Barrick Gold

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Nov. 20 2020, Updated 2:29 p.m. ET

Druckenmiller’s selling activity

In the previous parts of this series, we saw that billionaire investor Stanley Druckenmiller increased his position in various US technology stocks and Chinese consumer stocks in 2Q17. However, he dissolved his position in Barrick Gold (ABX) and the iShares MSCI Emerging Markets ETF (EEM) in 2Q17.

Duquesne Family Office’s top five sells in 2Q17 were LyondellBasell Industries (LYB), the iShares MSCI Emerging Markets ETF (EEM), Barrick Gold (ABX), Bank of America (BAC), and Alcoa (AA). These stocks represented 6.9%, 6.5%, 3.6%, 3.3%, and 3.1%, respectively, of the firm’s portfolio on June 30.

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Gold and equity market

Earlier, at the 2016 Sohn Investment Conference, Stanley Druckenmiller advised investors to take positions in gold (GDX) and gold miners (GLD) as the global outlook weakened. Gold and other safe-haven assets generally perform well in the midst of international turmoil. Now, Druckenmiller has sold the firm’s position in Barrick Gold, which shows that he might have a strong outlook on the equity market.

However, since January 2017, both the S&P 500 Index (SPX-INDEX) and gold prices have risen. On a year-to-date basis, the S&P 500 Index rose nearly 9.6% as of September 1, 2017. Gold prices (GLD) have risen nearly 14.5% during the same period. Marc Faber, editor and publisher of the Gloom, Boom & Doom Report, recently said in an interview with CNBC that the recent movement of gold and the S&P 500 Index in the same direction could lead to a great disruption in the market.

In the next part of this series, we’ll analyze Stanley Druckenmiller’s stance on the EEM ETF.

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