Gold’s sharp sell-off and the outlook into year-end

Max Layton, Mikhail Sprogis, Jeffrey Currie -

Gold has dropped sharply over the past month, from c.$1,350/oz to c.$1,250/oz, with the majority of the move lower occurring on Tuesday of this week, following hawkish comments by Fed officials (Lacker in particular) and a subsequent break of the psychologically and technically important $1,300/oz level (N.B. the next important… Read More »

Gold and silver: similar, but different


Silver is often looked at in gold’s shadow. The price performance of two metals is 80% correlated. We find that the best way to model silver prices is by looking at gold prices. Silver in gold’s shadowSilver’s price performance is 80% correlated with gold’s price performance. When investor sentiment toward… Read More »

Gold price: UBP remains prudent


Union Bancaire Privée – UBP is maintaining its prudent stance on gold and stand by its conviction that the yellow metal will probably remain range-bound for the months to come … … on the one hand it will continue to be seen as a safe haven and to benefit from… Read More »

Potential benefits of a precious metals allocation


Adding a precious metals allocation to a diversified stock-bond portfolio has historically increased portfolio efficiency – lowering risk while increasing return Precious metals such as gold, silver, platinum, and palladium have grown in prominence in recent years as viable investment alternatives to include in asset allocations. Despite being one of… Read More »

Gold and Precious Metals: Relationship on the rocks


Precious metals equities have re-rated to historical peaks or above. Morgan Stanley lifts its bull cases to reflect this, but still the risk reward is unappealing bar continued commodity price rises. MS downgrades Randgold to UW, with Centamin most and Fresnillo least preferred. Equity valuation disconnects… The recent rally in precious… Read More »

Time to short sugar, coffee and soybeans

Nitesh Shah -

Sugar, coffee and soybeans have made spectacular returns this year, but much of their gains have been driven by currency movements, particularly the Brazilian Real Brazilian Real drives rallyThe El Niño weather pattern led to a failed monsoon in India and unseasonably wet weather in South America in 2015/16.However at… Read More »

Gold to outshine gold miners


Stronger Q1 2016 earnings coupled with the rising price of gold helped improve sentiment towards gold miners, driving the rally so far. Gold miners tighten their belts too much too fastGold miners have skyrocketed since the start of the year, staging a 81.6% rally. That is the strongest 6-month rally… Read More »

How to lower volatility


Single commodities are subject to specific and sometimes unique factors which drive price trends to be distinct and for volatility to be elevated. In this instalment, we take a closer look at some of the most important drivers responsible for the volatility seen in single commodities and how to mitigate with… Read More »

Attractive fundamentals trump fragile risk backdrop


Uncertainty over the US Federal Reserve (Fed) policy, risks of the UK exiting the EU, a China slowdown and a lacklustre earnings season in developed markets have all contributed to greater volatility in asset classes. We continue to expect further weakness in the US dollar in the coming month, primarily… Read More »