Fund manager prefers bullion to shares: "We are a believer in owning the physical metals"
With South Africa the fifth-largest miner in the world, according to Dawn Bennett, portfolio manager of the Bennett Group of Funds, "the strikes will harm the global supply of
precious metals." ...
For investors, analysts recommended a rather cautious approach when it comes to mining companies. "The risk to investors is significant because the strikes are unpredictable," said Sandstorm Gold's Awram. "There has been a contagion effect from the initial labor unrest and nobody really knows how long the disruptions will go on for."
Given that, "avoiding investment in these areas is prudent until stability is more apparent," he said.
Bennett said the Bennett Group of Funds doesn't invest in mining companies, because mining stocks "act no different than other stocks during a bear market. They will sell off, underperform and expose investors to market risk."
On the other hand, "we are a believer in owning the physical metals however we can get [them]," she said. "We are investors for the short, medium and long term" when it comes to
platinum-group metals and
gold.
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