While gold is at $1,500 an ounce, Kinross Gold and Jaguar Mining hit 52w low today. Is this an opportunity to go long with them? or in fact these are the proof that the best way to invest in gold is to buy physical?
Investors buy gold mining companies and hope for the leverage they are supposed to provide over gold prices. But these companies like any other companies face operating issues that include:
1. Operating cost increase
2. Capital cost increase
3. Political crisis and therefore the risks
4. Mines are normally in the middle of nowhere and not easy to operate
5. Incompetent management - bad acquisitions
On the other hand, it is really hard not make money when your cash costs are below $800 an ounce! Is this time to double down? See the video below.
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