Opinions
Mike S. Newton, CIM FCSI
Sprott Physical Gold
PHYS-T
COMMENT
May 22, 2020
Stock price when the opinion was issued
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He's not a gold bug, but there's a time and place to own different assets. Tremendous amount of government debt. Central banks around the world are buying gold right now at the greatest pace in a decade. Private investors are not engaged, because they had such a bad experience over time.
Part of a balanced portfolio. Own less fixed income, and more gold as an alternative safety hedge. For the first time in 45 years, less volatile than a treasury bond.
Given current global uncertainty following the recent US election and events in Europe, holding gold is a good hedge at the moment. PHYS holds physical bullion that is unencumbered and fully allocated. We recommend setting a stop-loss at $25, looking to achieve $34 -- upside potential of 18%. Yield 0%
We reiterate PHYS as a TOP PICK. This trust holds physical gold bullion that is unencumbered, trades in Canadian dollars and avoids operational risk associated to owning a gold producer. Given uncertainty in world trade and geopolitics, it is a good holding at the moment. We recommend trailing the stop up (from $25) to $29, looking to achieve $38 -- upside of 18%. Yield 0%
As markets struggle with US Administration tariffs, we reiterate PHYS as a TOP PICK. This trust holds physical gold bullion that is unencumbered, trades in Canadian dollars and avoids operational risk associated to owning a gold producer. Given uncertainty in world trade and geopolitics, it is a good holding at the moment. We recommend trailing the stop up (from $29) to $31, looking to achieve $40 -- upside of 17%. Yield 0%
Gold producers? He prefers to own the Royal Canadian Mint (MNT) and Sprot (PHY.US) and Franco-Nevada (FNV). He likes the physical element. He would also consider the Junior Miners ETF (GDXJ). At some point, there will be a role for gold to help the economy recover.