Gold has outperformed most asset classes so far in this latest market sell-off. It ended March with a slight $8.51 (0.5%) loss to close at $1,577.18 per ounce. It has performed not only as a hedge against the turmoil that has beset the market, but is also well positioned to remain as one against the inflation that might eventually come from all the central bank and administrative intervention. We expect gold stocks to rise to reflect the underlying strength in the gold price once the panic has subsided and companies are able to return to full production. The sector remains financially strong with low debt and strong cash flow.
Source: MV Index Solutions, Bloomberg, Data as of 03/31/2020
Joe Foster has been Portfolio Manager for the VanEck International Investors Gold Fund since 1998 and the VanEck – Global Gold UCITS Fund since 2012. Mr. Foster, an acknowledged authority on gold, has over 10 years of dedicated experience in geology and mining including as a gold geologist in Nevada. He has appeared in The Wall Street Journal, Financial Times, Barron's, and on Reuters, CNBC and Bloomberg TV. Mr. Foster has also published articles in a number of mining journals, including Mining Engineering and Geological Society of Nevada.
The article above is an opinion of the author and does not necessarily reflect the opinion of MV Index Solutions or its affiliates.