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Miners with both gold and copper exposure

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    Miners with both gold and copper exposure

    Hi guys, Apologies if you've covered this recently and I've missed it. If so, feel free to point me to it. I'm wondering what your thoughts are on miners with both gold and copper exposure. A while ago I loved them, as I believed there was potential upside in both. Now though I'm wondering how much higher gold can go, and whether the risk/reward still holds up? Or are we getting to a point where any future upside in copper is likely to be offset by a decline in gold..? Do you have an opinion on this? Thanks Brent

    Answer

    Hi Brent,

    We have discussed the Copper (Cu) / Gold (XAU) mix a few times recently with particular reference to Evolution Mining (EVN) which we hold in our Active Growth Portfolio. At this stage we see a few moving parts at play:

    • We are bullish gold medium term but wouldn’t be surprised to see a pullback towards $US2,500 after the precious metals recent (failed) assault on $US3,000.
    • We are big fans of the supply/demand outlook toward Cu over the coming years but the industrial metal needs optimism towards China to regain its “Mojo”.
    • We are huge fans of EVN believing it offers great risk/reward in the $5.50 area.

    In other words we are “buyers of dip” in quality stocks exposed to the mix.

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    Evolution Mining Ltd (EVN)
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