Thoughts on gold here

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Question asked 22/02/2021

Thoughts on gold here

James. I am interested in your opinion on the direction of gold and the share price of Australian gold miners. Production, profits, cash in bank all up, and likely to stay so into the next half, yet due to the negative direction of the gold price their share prices are floundering. Will inflation bring a bounce? Are they still worth holding as a hedge against the inflated market? Is patience required? Or, is it time to sell out (at a loss in NCM and GOR for me) and put the funds elsewhere? thanks, Charlie

Answer

Morning Charlie,

There isn’t a day goes by that I don’t ask myself the same question with Newcrest (NCM), it feels like a ball and chain hanging off our Growth Portfolio. At the moment we are being patient with NCM but its most definitely on our watch list to jettison for a loss. Fortunately we believe the company is kicking some goals operationally hence its likely to bounce well when the sector finally enjoys a bid – NCM has fallen 37% while gold has fallen 14% in $US terms and more basis the $A.

Also it’s important we remind ourselves that we expect plenty of volatility under the hood in 2021 which should at least mean the precious metal stocks enjoy a bounce

NCM

MM is being patient towards NCM for now.

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LAST UPDATED 01/03/2021 07:18

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