ABX:CC - Gold Is Heating Up: 2 Smart Ways to Invest
2023-12-12 19:00:00 ET
The spot price of gold has had a chance to shine a bit over the past few months. As we head into 2024, there’s a chance that the shiny precious metal could sustainably surge into new highs as interest rate hikes come to an end. Undoubtedly, lower rates could provide a nice jolt to the gold plays. Either way, it’s never a good idea to time the trajectory of interest rates, especially when it’s the talk of the town.
These days, many gold stocks look unappreciated, even given the recent trajectory of gold’s spot price. Indeed, being a miner can have its pitfalls. However, if gold does manage to sustain higher highs over the coming quarters, the gold miner plays may very well be able to deliver an outsized gain for investors. The gold miners tend to be far more volatile than the price of gold itself.
If you’re a younger investor who’s looking to diversify into the gold markets, the miners may be the best way to do it if you’ve got the stomach for elevated volatility and the patience to let shares fluctuate over time. Indeed, volatility is a given when it comes to even the brightest gold stock in the market.
In this piece, we’ll check in on two intriguing gold miners who look to offer a pretty decent bang for your buck at current levels. Though it’s pretty much impossible to time where gold will go next, the diversification benefits make them well worth the price of admission.
Barrick Gold
No surprises here. Barrick Gold ( TSX:ABX ) tops the list of top investments to play the price of gold. The stock has been rather tame in recent years, moving in both directions but ultimately offering “flat” returns over the past two years (shares down 2% over the timespan), despite the recent upward move in the price of gold.
Last week, shares sank by more than 4% as gold’s run cooled off a bit. I view the dip as a great entry point for investors seeking a long-term position in the miner. The 2.37% dividend yield is incredibly bountiful and makes for a “main attraction” to the top miner.
Finally, the company’s top boss, Chief Executive Officer Mark Bristow, is one of the best managers in the space. As gold surprises us all in 2024, count on Bristow and company to continue doing their best to operate in any sort of climate.
AngloGold Ashanti
AngloGold Ashanti ( NYSE:AU ) is a pretty intriguing miner that recently fell almost 9% over the past week as gold retreated a tad. The stock is down around 11% over the past two years, thanks in part to sub-optimal quarters. The recent third-quarter results weren’t too encouraging, as year-to-date production fell short of analysts’ estimates as the Obuasi mine (in Ghana) saw output fall substantially.
I view AU stock as a relative bargain in the gold scene right now. The yield may be quite small at 0.42%. However, I think there could be some amplified upside as the firm rights its wrongs while gold does its thing going into the new year.
The post Gold Is Heating Up: 2 Smart Ways to Invest appeared first on The Motley Fool Canada .
Fool contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .
2023