Why Gold Investors Need to Pay Attention to the Lifecycle of Mines

Author: USGI
Date Posted: November 6, 2015 Read time: 2 min

Ralph Aldis, portfolio manager of the Gold and Precious Metals Fund (USERX), joins MoneyShow’s Steven Halpern to discuss the catalysts he looks for when analyzing gold mining stocks.

Ralph Aldis, portfolio manager of the Gold and Precious Metals Fund (USERX), joins MoneyShow’s Steven Halpern to discuss the catalysts he looks for when analyzing gold mining stocks. Ralph says it’s important to consider the mine’s lifecycle because a stock’s price action is often dependent on which stage the mine is in.

“If there’s a discovery, then the stock can move up quite a bit,” Ralph says. “Permits being awarded or not being awarded would also be a big catalyst for a positive or negative price reaction.”

Listen to the entire interview to learn about Ralph’s “alpha-based” investment strategy.

 

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Gold, precious metals, and precious minerals funds may be susceptible to adverse economic, political or regulatory developments due to concentrating in a single theme. The prices of gold, precious metals, and precious minerals are subject to substantial price fluctuations over short periods of time and may be affected by unpredicted international monetary and political policies. We suggest investing no more than 5% to 10% of your portfolio in these sectors.

Alpha is a measure of performance on a risk-adjusted basis. Alpha takes the volatility (price risk) of a mutual fund and compares its risk-adjusted performance to a benchmark index. The excess return of the fund relative to the return of the benchmark index is a fund’s alpha. Beta is a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole.

Fund portfolios are actively managed, and holdings may change daily. Holdings are reported as of the most recent quarter-end. Holdings in the Gold and Precious Metals Fund as a percentage of net assets as of 9/30/2015: Klondex Mines Ltd. 16.91%, Newmont Mining Corp. 0.85%, Osisko Gold Royalties Ltd. 6.23%.

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