Gold, as a physical asset, has for centuries been regarded as an asset that will hold its value over time. It’s relatively rare and its value is respected regardless of political borders. So gold ingots, bars, wafers, minted coins and jewelry with a high gold content have long been favored as safe havens for value. However, storing wealth in such a manner does have some difficulties. Safety and cost of storage are considerations and finding a buyer may be difficult, especially with jewelry and coins which may have high markups for reasons to do with aesthetics and rarity. The securities industry offers some alternatives. A simple way to use gold as part of your investing strategy is to buy units in an exchange-traded fund or ETF. A gold ETF does not, however, own any gold. Rather it holds derivative contracts that are backed by gold. Therefore the fund’s units reflect the changing price of gold. When you sell, you get cash, not gold.
There is another popular way to invest in gold through the stock market. There are many companies engaged in the exploration, mining and production of gold that offer their shares for sale on the stock market. However, the price of gold bullion, as it rises and falls, often has a levered effect on gold stocks. This means that the price of gold stocks is usually more volatile than the price of the underlying commodity. And while your gold stock’s corporate headquarters may be situated in a safe, stable country, its mines may be located abroad and exposed to the downside of some less developed jurisdictions around the world. You may find the price of your gold stock suddenly subjected to a sudden jump in costs, a drop in ore grades, strikes, expropriations, floods and so on. Or worse. Many Canadians will remember Bre-X Minerals Ltd., a company with headquarters in Calgary, that bought a property in the jungle near the Busang River in Borneo, Indonesia. Before the supposed discovery of gold was all exposed as a fraud, Bre-X’s capitalization grew to over $6 billion CAD in 1996. Its shares were soon worthless.
Investor's Digest of Canada •2020-06-11 •
Low energy prices and weaker local currencies versus the USD, improve the profitability of silver and gold stocks in Mexico, Australia and Canada.
The best medicine for market reactions to COVID-19’s Read More
The TaxLetter •2020-03-08 •
Old tax returns aren’t as much fun as mountain music but they provided an eye-opening experience for Toronto-based accountant Mark Goodfield, a.k.a. The Blunt Bean Counter.
When I was a young Read More
The TaxLetter •2019-12-15 •
Shredding some old tax returns was an eye-opening experience for Toronto-based accountant Mark Goodfield, a.k.a. The Blunt Bean Counter.
When I was a young accountant and happened upon an estate return, Read More
The MoneyLetter •2019-11-20 •
There is a distinct possibility that the bond market, the stock market and the economy all peaked in the third quarter of 2019. Something is wrong. Beyond the Bull author Read More
The MoneyLetter •2019-10-23 •
Ken Norquay recalls the late Richard Russell’s admonition in making the case that investors who have not adopted financial plans that include selling, should do so immediately.
I remember those carefree Read More
The MoneyLetter •2019-04-03 •
Equity mutual fund managers sense a high risk in the stock market and are increasing their cash reserves. But the amount of cash they hold is restricted by the fund’s Read More
Investor's Digest of Canada •2019-02-25 •
PI Financial’s Chris Thompson and Philip Ker say investors should watch for a potent reversal and widening of the gold-to-silver ratio to historic highs (roughly 86:1) which will favour accumulating Read More
The MoneyLetter •2019-02-07 •
Equity mutual fund managers sense a high risk in the stock market and are increasing their cash reserves. But the amount of cash they hold is restricted by the fund’s Read More
The MoneyLetter •2019-01-17 •
Behavioural financial analyst Ken Norquay believes managers of big portfolios are ‘concerned’ about the market. But they have a liquidity problem. Selling will depress the market. Small investors don’t have Read More
Investor's Digest of Canada •2018-09-25 •
If gold reaches more than US$1,377.50 per ounce, seasonal analyst Don Vialoux says: “Every analyst on the street is going to be yelling: ‘We’re finally reaching the next secular cycle Read More
Investor's Digest of Canada •2018-07-04 •
If gold reaches more than US$1,377.50 per ounce, seasonal analyst Don Vialoux says: “Every analyst on the street is going to be yelling: ‘We’re finally reaching the next secular cycle Read More
The MoneyLetter •2018-03-29 •
‘How High is Up?’ The Three Stooges, in the 1940 short film of that name, found it was on the 97th floor of a Manhattan construction site. MoneyLetter columnist Keith Read More
The Investment Reporter •2018-03-18 •
When you buy stocks in sectors and sub-sectors of the market, keep your goals in mind. If you’re a conservative, income-seeking investor, focus on utilities, financial stocks and consumer stocks. Read More
Money Reporter •2018-01-15 •
Given its record gold production and strong cash flow generation, gold stock Agnico has increased its production guidance and its dividend. Production is now expected to exceed 1.68 million ounces Read More
The Investment Reporter •2018-01-14 •
It’s best to diversify your portfolio across all five sectors of the economy: finance, utilities, consumer, manufacturing and resources. Remember, though, there’s danger in loading up on stocks in sectors Read More
Investor's Digest of Canada •2017-12-05 •
Timing the Market and Equity Clock founder, Don Vialoux says the season for investing in gold and silver is now (especially silver). He lists his two recommendations for gold and Read More
The Investment Reporter •2017-11-07 •
It’s said that gold comes out of dark underground mines only to disappear into dark bank vaults. When we publish our gold stock survey, we do outline the yellow metal’s Read More
The Investment Reporter •2017-09-14 •
Four times a year The Investment Reporter reviews its outlook for the economy’s five main sectors—financial, utilities, manufacturing, consumer and resources. Its guiding rule is that investors keep at least Read More
The MoneyLetter •2017-09-06 •
The MoneyLetter columnist Ken Norquay creates a long-term investment strategy based on his study of behavioural finance and its effect on the stock markets. He says if the S&P 500 Read More
The MoneyLetter •2017-07-26 •
Would starting all over again from scratch make you a better investor? For behavioural finance analyst Ken Norquay, a friend’s sudden and total move across the country caused him to Read More
Money Reporter •2017-07-24 •
Rising interest rates have historically benefitted cyclical securities like mining stocks, fertilizer stocks and gold stocks. The Money Reporter picks a mutual fund with broad exposure to the sector, a Read More
Investor's Digest of Canada •2017-07-02 •
Technical analyst Brian Hoffman sets share price support levels for three mainstream blue chip stocks, gold and silver bullion, six precious metals stocks and a gold ETF during the traditionally Read More
The MoneyLetter •2017-06-14 •
Many a gold stock’s headquarters are situated in a safe, stable country, but its mines may be located abroad and exposed to the downside of some less developed jurisdictions around Read More
The Investment Reporter •2017-06-13 •
When you buy stocks in sectors and sub-sectors of the market, keep your portfolio balance goals in mind. If you’re a conservative, income-seeking investor, focus on utilities, financial and consumer Read More
Investor's Digest of Canada •2017-06-11 •
Columnist Edward Gardiner looks at the uncertainties surrounding NAFTA negotiations, the U.S. budget and events in Europe. He’s encouraged enough to recommend holding pipelines, oil and gas stocks and automotive Read More
The MoneyLetter •2017-06-08 •
Moody’s has downgraded the big six Canadian banks. But, much like when a tree falls in the forest, did anyone hear it? Professional money managers, who talk like bulls and Read More
The Investment Reporter •2017-05-02 •
And six gold stocks to buy if you must. The price of gold appears to have stabilized. Lower producer costs raise profits. While you might hold a little gold to Read More
Investor's Digest of Canada •2017-04-03 •
Stock markets keep rising as the precious metals miners’ rally pauses. Technical analyst Brian Hoffman warns that investors should watch support levels in an environment like this. He names three Read More
Investor's Digest of Canada •2017-02-20 •
Gold and gold mining stocks will benefit from the turbulence of the Trump presidency. And, analyst David Chapman writes in Investor’s Digest of Canada, the amount of new gold being Read More
The MoneyLetter •2016-12-01 •
Fear and loathing interferes with our good judgment. The MoneyLetter’s regular contributing columnist Ken Norquay applies lessons learned observing the recent U.S. presidential election to help us become objective investors.
What Read More
Investor's Digest of Canada •2016-11-01 •
Near-term production and district-scale potential has attracted some of Canada’s biggest and best-known gold investors to this junior gold mining stock. Investor’s Digest of Canada columnist Richard Buzbuzian says Golden Read More
Investor's Digest of Canada •2016-10-17 •
Investor’s Digest of Canada technical analyst Brian Hoffman says rising wedge patterns have formed in the precious metals sector, the oil patch, financial companies and with broader market indexes. A Read More
Investor's Digest of Canada •2016-08-08 •
Major metrics indicate that gold stock Iamgold Corporation is a quality business with longer-term appeal. Iamgold is a Toronto-based international gold producer with operating mines on three continents. The company Read More
Investor's Digest of Canada •2016-07-13 •
Voters in the United Kingdom have voted to leave the European Union. The U.S. Fed has signaled that U.S. interest rates will remain lower for longer, perhaps not rising until Read More
Investor's Digest of Canada •2016-07-07 •
Markets have hit some resistance as the weather has warmed and seasonality is a likely catalyst for the correction. The S&P/TSX Composite Index has found resistance just above 14,000. Technical Read More
The Investment Reporter •2016-06-23 •
When you buy stocks in sectors and sub-sectors of the market, keep your goals in mind. If you’re a conservative, income-seeking investor, focus on utilities, financial stocks and consumer stocks. Read More
Investor's Digest of Canada •2016-05-18 •
Since the U.S. Federal Reserve’s 1913 creation, gold has retained its purchasing power while the U.S. dollar is worth 98.2 per cent less. Nick Barisheff, president and CEO of Markham, Read More
The MoneyLetter •2016-05-11 •
Barrie, Ont.-based ValueTrend portfolio manager Keith Richards thinks so and he offers nine indicators as the evidence that convinced him to adopt a bearish market outlook and a defensive investment Read More
The Investment Reporter •2016-05-05 •
The price of gold has recovered somewhat so far in 2016. While you might hold a little gold for diversification purposes, remember its disadvantages.
Gold has been trading above US$1,250 an Read More
The MoneyLetter •2016-04-24 •
“…there are known knowns; …there are known unknowns; …there are also unknown unknowns.”–Donald Rumsfeld. “Don’t pretend to know the unknowable.”–Ken Norquay.
Behavioural finance strategist Ken Norquay is a frequent contributor to Read More
The MoneyLetter •2016-03-27 •
Your best long term strategic investment plan is to balance your portfolio across the five main sectors of the economy: finance, utilities, consumer products and services, manufacturing and resources. Each Read More
The MoneyLetter •2016-03-23 •
If you believe a continued market downtrend for the intermediate term is likely, then shorting the market with exchange traded funds, stocks, currencies and gold might be of interest to Read More
Investor's Digest of Canada •2016-03-06 •
The tech stock favourites of the stock market have fallen back and precious metals and the companies that produce them may pull back after a brief rally. Toronto-based Brian Hoffman, Read More
The Investment Reporter •2015-11-10 •
The price of gold seems stuck at low levels with no recovery in sight. While you might hold some gold stocks for diversification purposes, remember gold’s drawbacks.
Gold trades at US$1,173 Read More
Investor's Digest of Canada •2015-08-19 •
Despite hand-wringing over America’s rising debt levels, U.S. markets continue to lead the world and the S&P 500 Composite Index has risen sharply over the past six years. Keith Richards, Read More
Investor's Digest of Canada •2015-04-24 •
Analysts surveyed by Investor’s Digest of Canada this month rated Goldcorp among the best gold stocks to invest in. Of the 11 analysts polled, nine rated this Vancouver-based company’s mining Read More
The MoneyLetter •2015-03-27 •
There appears to be lots of cheer as the markets keep rising. But the 200-day moving average suggests this is a bear . . . in bull’s clothing. Understanding institutional Read More
Canadian Mutual Fund Adviser •2014-11-28 •
The lessons of stock-market volatility especially apply to specialty funds. If you learn from them, consider any losses the cost of tuition at the school of Bay Street. You can, Read More
Canadian Mutual Fund Adviser •2014-01-31 •
Canadian Mutual Fund Adviser, MPL Communications Inc.
133 Richmond St.W., Toronto, ON, M5H 3M8. 1-800-804-8846
Most investment strategies stress one of two approaches. One of these is to chase after the action; Read More
