David MacNicol has always described himself as a contrarian, so while investors have been exiting gold en masse for years, the natural reaction for him was to stay put.
Now the president and portfolio manager of Toronto-based investment firm MacNicol & Associates believes things are turning back in the yellow metal’s favour.
“We think we’re at the end of a cycle and at a turning point for gold and it has everything to do with interest rates and debt levels,” said MacNicol, who thinks the precious metal’s role as a safe haven remains intact.
Gold prices soared to a high of US$1920.70 an ounce from US$270 during an 11-year bull market between 2001 and 2012. After hitting a floor in 2012, the price has never quite recovered. Since then, investors have remained sour on the Canadian gold mining sector, which was the victim of poorly-executed mergers that left companies struggling to clear their balance sheets.
But a new string of mega-deals appears to have brought some excitement back to the sector, especially from institutional and retail investors who predict further acquisitions are on the way.
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