When the billionaires invest in gold should you do too?

Readers’ attention is drawn to my latest article published on Seeking Alpha:   Billionaires, Gold And Gold Stocks… They Are In For The Long Term, Should You Be Too?  In it I look at what the latest highly-publicised news of some huge investments in gold and gold stocks by some of the USA’s wealthiest elite means in terms of investment guidance for the individual investor.  Obviously this news only comes to light some time after these big investments have been made – and big gains will already have been made.  Is it too late to join them?

But, as a general rule – there are exceptions of course – these mega-investors are looking to the medium to longer term appreciation of their assets.  They have invested because they see the signs that the prospects for precious metals appreciation over the next months and years is positive, and for precious metals stocks perhaps even more so.  There have been huge gains in gold mining majors’ stock prices for example so far this year – a table from the article is appended below showing some of these, the gold price itself and, for comparison, one of the most followed gold stock indices (the XAU) and a junior precious metals stocks ETF (GDXJ):

Company

Price December 31st Current Price – May 30th 2016 Peak to date % below peak % rise since Dec 31st
Barrick Gold

7.38

16.62 19.37 14.2 125.2

Newmont

17.99

31.96 35.55 10.1

77.7

Goldcorp

11.56 16.60 20.15 17.6

43.5

Kinross

1.82

4.23 5.70 25.8

132.4

XAU

45.3

79.41 92.85 14.5

75.3

GDXJ

19.21

32.89 39.20 16.1

71.2

Gold Price 1061.30 1208.36 1292.98 6.5

13.9

 

While the recent slump in the gold price has meant prices have come back from their highs, all are hugely still in positive territory and the recent pullback may well present a great buying opportunity – particularly if you are convinced that the gold price has further to rise in the months and years ahead.

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