Finweek English Edition - - Cover -

BEAR­ISH ON GOLD. Be­lieves in­vestors should be wary of gold eq­ui­ties that won’t bot­tom out un­til the JSE’s gold in­dex is around 1 400 points. “Then it’s a buy.” It’s cur­rently at about 2 700 points.

“The ex­change traded fund is ar­ti­fi­cially hold­ing the gold price higher. But it’s a hel­luva dan­ger­ous in­stru­ment be­cause in­vestors start be­liev­ing gold is go­ing up and when it doesn’t they be­come spec­u­la­tors. Jew­ellery de­mand is not good and the re­cy­cling of gold from scrap is com­ing back into the mar­ket. And the gold shares just aren’t per­form­ing. That’s telling us some­thing.”

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