Gold is an interesting one; it came up today in client conversations.

Normally gold likes volatility and doesn’t like high real interest rates. And you pop that it into a model and the model says “huh, maybe don’t buy gold at these levels”.

But then, it is held out as an inflation hedge and portfolio diversifier, and that maybe the cost curve support is there, given that inflation has pushed production costs up by +25% in many instances, and so the old $1300-1500/oz is some new meaningfully higher number.

Could be, could be. We were happy to buy $NCM below $20, and maybe Newmont in the low $50s, but physical gold, at these levels, is a harder one for us.

But we can definitely get the appeal, and it has been, alongside the USD, one of the few investments that has been ex post positive return whilst being negative correlated to stocks and bonds.

Sharpe ratios, which I laboured on about today (in context of another fund) off the charts.

Important Information: This document has been prepared by Aequitas Investment Partners ABN 92 644 165 266 (“Aequitas”, “our”, “we”), a Corporate Authorised Representative (no. 1284389) of C2 Financial Services, (Australian Financial Services Licensee no. 502171), and is for distribution within Australia to wholesale clients and financial advisers only.

This document is based on information available at the time of publishing, information which we believe is correct and any opinions, conclusions or forecasts are reasonably held or made as at the time of its compilation, but no warranty is made as to its accuracy, reliability or completeness. To the extent permitted by law, neither Aequitas nor any of its affiliates accept liability to any person for loss or damage arising from the use of the information herein.

Please note that past performance is not a reliable indicator of future performance.

General Advice Warning: This document has been prepared without taking into account your objectives, financial situation or needs, and therefore you should consider its appropriateness, having regard to your objectives, financial situation and needs. Before making any decision about whether to acquire a financial product, you should obtain and read the relevant Product Disclosure Statement (PDS) or Investor Directed Portfolio Service Guide (IDPS Guide) and consider talking to a financial adviser.

Taxation warning: Any taxation considerations are general and based on present taxation laws and may be subject to change. Aequitas is not a registered tax (financial) adviser under the Tax Agent Services Act 2009 and investors should seek tax advice from a registered tax agent or a registered tax (financial) adviser if they intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise, or could arise, under a taxation law.