Spot Price and Share Price of Gold

CNBC is reporting that gold is down from its high this week. The markets are stabilizing, and the upward momentum for gold is diminishing.

Rick Rule on Gold

How do you reconcile the difference between the spot price of gold and gold share prices? In the last bull market for gold from 2000-2010, the gold price rose $250 to $1,900/ounce, but earnings declined. Until management teams can effectively turn the gold price into cash flow, you’ll see the gold share prices languish vs. gold prices. The companies that have the best leverage to gold are the inefficient producers (high costs). We need gold companies to show the same financial acumen as companies in other industries.

Gold prices may rise, and gold share prices may decline. Companies that have the best leverage to gold are the inefficient producers. Gold companies need to have financial acumen as companies in other industries.