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What About Gold?

publication date: Aug 9, 2019
 | 
author/source: Brian Nelson, CFA

A version of this note was emailed to members August 8, 2019. Please contact us at info@valuentum.com if you are not receiving our emails.

What About Gold?

By Brian Nelson, CFA

Hi everyone,

Hope you are having a great day! I wanted to thank you so much for being here. I'm so appreciative of your interest and attention, and for making Valuentum what it is -- we are making a huge difference for investors, and it's all because of your support! Don't forget to leave a review of Value Trap. Even a couple sentences mean a lot!

For those new members that are just getting familiar with our offerings, with the basic premium membership, we offer two newsletters and access to the website. The Best Ideas Newsletter is our flagship publication at the regular premium level. Today, I wanted to bring your attention to Best Ideas Newsletter portfolio idea Booking Holdings (BKNG), which put up a fantastic second-quarter report yesterday. You can read our latest thoughts here. We continue to like shares of this free-cash-flow generating powerhouse!  

I know a lot of members have been asking about the Exclusive lately, and yes, we will extend the time to lock in the pricing until the end of this week. Today, our short-idea consideration in the August edition of the Exclusive fell ~20% on a poor second-quarter report. Simply incredible. I think the Exclusive stands head-and-shoulders above any publication out there. This publication is limited to 1,000 members, and be sure to contact us this week to lock in the annual pricing at $1,000/year (the pricing has already gone up on the website).

We truly have the best members, and I thank you for joining the conversation on the market plunge -- see that note here. We expect the markets to continue to be highly volatile in the coming years, and we reiterate our opinion that nobody truly wins a trade war. Even if the US "tariffs-China-into-submission," the White House has to be very careful. If it pushes China too hard, it could tip the country into a "deflationary bust," with implications on banking entities across the globe. It's a delicate balance; even if the US wins, it might lose.

My colleague Callum Turcan has written a number of excellent research pieces of late. One of the most popular REITs Realty Income (O) reported recently, and you can read our thoughts on its second-quarter report here. The energy sector has been in a world of hurt of late, and you can find our team's latest thoughts on the oil majors here. Many members have inquired about Tallgrass Energy (TGE) recently, and you can read our update here. Our take on Sprouts Farmers Market (SFM) can be found hereOur write-up on General Motors (GM) can be found here. Let us know if you have any special requests, and we can write them up.

A few more things in the news I wanted to get in front of you: Our take on gold is similar to that of Warren Buffett's (he's not a "gold bug"), and you can read our views here; however, the SPDR Gold Trust (GLD) has broken out of a multi-year technical base, and while gold doesn't have what can be considered the traditional definition of intrinsic worth (i.e. the ability to organically generate a dividend or future free cash flows), we can't help but pay attention to the metal in the context of an environment of trade and currency wars, the Fed cutting rates near all-time highs in the S&P 500 (SPY) and many talking about the likelihood of negative interest-rate policy (NIRP) in the US. Conditions are far from "normal."  

Image Shown: The SPDR Gold Trust is breaking out of a multi-year technical base. This could indicate a structural change, and we're paying attention.

One last thing before we part for the afternoon. Notice how we didn't overreact in the newsletter portfolios on the big panic-driven sell-off this week. We didn't make any moves this week. We talked a lot about positioning and what we might do, but we never pulled the trigger. Today, Thursday, the S&P 500 is now up for the week. Had we overreacted (as many others did), we not only would have whipsawed our members, but we would have missed the strong bounce. I want you to work on acquiring these type of instincts: quite simply, know when to hold 'em, know when to fold 'em. We're still fully invested in both the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio, as we await what's next. 

We're available for any questions!

Thank you!

Metals & Mining - Gold: ABX, AUY, EGO, GG, KGC, NEM

Related ETFs: GDX, NUGT, GGN, DUST, IAU, PHYS, SGOL

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Brian Nelson does not own shares in any of the securities mentioned above. Some of the companies written about in this article may be included in Valuentum's simulated newsletter portfolios. Contact Valuentum for more information about its editorial policies.

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