Visit our COVID-19 site for latest information regarding how we can support you. For up to date information about the pandemic visit www.sacoronavirus.co.za.

bs-regular
bs-extra-light
bs-light
bs-light
bs-cond-light-webfont
bs-medium
bs-bold
bs-black

Community


Share knowledge. Ask questions. Find answers.

Online Share Trading

Engage and learn about markets and trading online

Pric lagging

Reply
Starsky
Frequent Contributor
Hi, in line with the increasing Gold price in rand terms, ANG seems to be lagging.whats at play here? any thoughts
0 Kudos
4 REPLIES 4
PaulC
Super Contributor
Pretty much all the gold shares are lagging (if you look at the XAU and HUI indexes) Couple comments. ANG has its 2 largest producing areas (in order) of SA and Ghana. Ghana is pretty mining friendly but SA scares off international investors toward mining with the whole uncertain political outlook (nationalisation debates high mining taxes) Then cost of business here is high (labour and electricity - never mind the reliability) So thats the negative. That said I think the market is pricing gold stocks (worldwide, not just SA) as if the current gold price is temporary and is going to retreat down towards 1000. So gold mining stocks would be a longer term play if thats your thing. Once these companies post a few quarters of good earnings (they have had a couple) We'll see the investment community start to toss money in the mining direction. But mining is a risky costly business and not for everyone. It may have been simon who posted a comment a couple years back that went along the lines of "Definition of a mine. A hole in the ground with a liar on top" - Simon if it wasnt you, no offense meant. - P
0 Kudos
PaulC
Super Contributor
Pretty much all the gold shares are lagging (if you look at the XAU and HUI indexes) Couple comments. ANG has its 2 largest producing areas (in order) of SA and Ghana. Ghana is pretty mining friendly but SA scares off international investors toward mining with the whole uncertain political outlook (nationalisation debates high mining taxes) Then cost of business here is high (labour and electricity - never mind the reliability) So thats the negative. That said I think the market is pricing gold stocks (worldwide, not just SA) as if the current gold price is temporary and is going to retreat down towards 1000. So gold mining stocks would be a longer term play if thats your thing. Once these companies post a few quarters of good earnings (they have had a couple) We'll see the investment community start to toss money in the mining direction. But mining is a risky costly business and not for everyone. It may have been simon who posted a comment a couple years back that went along the lines of "Definition of a mine. A hole in the ground with a liar on top" - Simon if it wasnt you, no offense meant. - P
0 Kudos
Fredsed
Super Contributor
Commentary has it that ETF's are being preferred to miners, that commodity ETF's appear to be a drag on the related commodity sector. Less risk = less reward?
0 Kudos
Not applicable
Ghana mining friendly? You haven't been reading the press lately have you?
0 Kudos