Gold producers are doing everything they’re supposed to be doing — squeezing more profit out of mines, penny-pinching on projects and resisting the kind of big deals that got them into trouble when prices fell.
While that’s satisfying their large institutional shareholders, it’s not enough to lure more general investors drawn to flashier electric-vehicle commodities, as well as to stocks riding the marijuana and cryptocurrency booms.
Large producers such as Barrick Gold Corp. and Goldcorp Inc. surged in 2016 as they emerged from a painful multi-year downturn. Since then, they’ve largely decoupled from bullion, which has continued to rise, and are trading at the cheapest versus the Dow Jones Industrial Average in more than a year.
Investors seeking gold exposure are preferring exchange-traded funds, all at a time when money is pouring into lithium and cobalt companies that have plugged into the rechargeable-battery rush. That’s the message from the BMO metals and mining conference, where 1,400 bankers, miners and investors have gathered over four days in Florida.
“Right now, gold has been so boring and asleep that nobody cares,” David Harquail, chief executive officer of precious-metal streaming company Franco-Nevada Corp. and chairman of the World Gold Council, said in an interview from the conference. “It’s the first time, even my schedule isn’t filled.”
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