Most gold companies have ample flexibility to weather a slump in gold prices. Debt has been reduced to levels that are manageable at lower gold prices and many companies have no net debt.
The Vanguard Group announced that its $2.3 billion Precious Metals and Mining Fund will change focus in late September to a more diversified mandate that features telecommunications, utilities, materials, and natural resources.
The gold price in U.S. dollar terms has not responded to the Turkish crisis because, at this time, it poses virtually no immediate threat to either the U.S. economy or global financial system.
he second half of 2018 should be very interesting for the gold market. The chart shows the gold price has formed a wedge or pennant pattern that has been in place for several years.
With global rates normalizing, geopolitics still posing major risks, and with one of the longest bull runs in U.S. stocks apparently stalling, 2018 might be a year of paradigm shift.
Correlation analysis A correlation study of mining stocks to precious metals is important. It gives insights about miners’ potential price movement. Although the mining shares are essentially part of the market’s equity segment, they’re more coordinated with metals’ movement. Gold is the most dominant precious metals. We’ll discuss how Yamana Gold (AUY), Pan American Silver (PAAS), Coeur […]
As of November 16, 2017, Alamos Gold, First Majestic Silver, Sibanye Gold, and AngloGold Ashanti had call-implied volatilities of 46.9%, 54.6%, 63%, and 40.9%, respectively.
If we look beyond the dollar influence on precious metals, we can analyze how the probability of an interest rate hike could influence precious metals and their miners.
Investor complacency doesn’t hide the fact that there are financial risks to QT. Forty percent of the Fed’s balance sheet unwind is in mortgage-backed securities at the same time that the housing market is showing signs of slowing.
Since the financial crisis, the stock market has risen consistently as long as the Fed continued to buy treasuries and mortgage-backed securities through its quantitative easing policies (QE 1-3).
A record number of junior companies attended the Precious Metals Summit. We are finding companies with attractive development projects in North America and West Africa as well as some exciting discoveries that merit watching.
Gold stock indices also traded near their highs for the year, but then followed the gold price lower. During September the NYSE Arca Gold Miners Index (GDMNTR) retreated 6.5%.
The momentum gold experienced in August carried over into early September. Geopolitical tension continued as South Korea reacted to possible preparation by North Korea for an intercontinental ballistic missile launch.
The PowerShares DB Gold Fund (DGL) and the Vaneck Merk Gold Trust (OUNZ) have risen 12.1% and 12.95, respectively, year-to-date, taking strong cues from gold.
Bitcoin is a global digital payment system that offers lower transaction fees than other online payment systems. It’s operated by a decentralized authority.
Palladium has seen a YTD rise of a whopping 32.5%, which is higher than the rise in platinum, silver, and gold. Earlier, palladium was underperforming its precious metal peers.
Palladium has seen a year-to-date rise of a whopping 32.5%, which is higher than the rise in platinum, silver, and gold. Earlier, palladium was underperforming its precious metal peers.
The gold-palladium spread has seen its ups and downs over the past few months. But the United Kingdom’s Brexit vote resulted in some strength for palladium.
One of the dominant financial trends of the past decade has been a move by investors out of actively managed funds and into passively managed index funds or exchange traded funds (ETFs).
The Fed’s Shifting Stance on Rates The summer doldrums came late this year for gold and gold stocks. Now that the U.K. Brexit decision is old news, the markets are again obsessed with the Federal Reserve’s (the “Fed”) shifting stance on rate decisions. Although the Fed’s tone had been dovish on rate increases following the […]
Demand from India Could Lend Support In the near term, India could lend support to the gold market. Indian gold demand has been very weak this year due mainly to the higher gold price. This suggests there is pent-up demand. A good monsoon season in India can lead to a bountiful fall harvest that typically […]
Yellen Channels Doobie Brothers’ “What Were Once Vices Are Now Habits” Another aspect of Janet Yellen’s Jackson Hole speech furthered our conviction for strong gold prices in the long term. She described all of the unconventional monetary policies implemented since the financial crisis (e.g., zero rates, QE, etc.) as components of the Fed’s “toolkit”. Perhaps […]
The Fed has probably never tightened rates in past cycles with indicators so weak. In fact, at this point in the business cycle, a more normal stance would be to hold steady, looking ahead to a time when it might cut rates. Because of this, we believe any decision to raise rates in 2016 will […]
Perhaps one of the biggest tailwinds recently, particularly for local currency strategies, has been the stabilization and rebound in commodity prices this year.
In January 2016, Russia’s central bank bought almost 22 tons of gold worth ~$800 million—the eleventh month in a row that it bought large gold volumes.
As the dollar strengthens, dollar-denominated assets usually suffer. Foreign investors have to buy a rather expensive dollar to invest in these metals.
