Is the market still missing out on gold?

If you’ve followed global markets recently, you’d be forgiven for thinking we are in the middle of a modern age gold rush.

Over the past twelve months, the price of gold has increased by more than 43.2%. The price of the sought-after mineral is now sitting at a record high price of more than US$3,759 an ounce.

With such exuberance, it might be easy for investors to think that they have missed out. Not so, says Mark Landau, Joint Managing Director and Chief Investment Officer of L1 Capital.

Joining Allan Gray’s Simon Mawhinney at this year’s Livewire Live event, Landau remained bullish on the mineral.

L1 had already benefited from gold’s recent run; their gold fund, launched earlier in the year, is up by more than 65% with hedges in place.

In fact, Landau thinks that a large group of investors are still overlooking the asset class.

“I don’t think the average fund manager in America or Europe is really talking gold stocks, they are still talking tech stocks and AI”.

Landau was, however, not a fan of local gold miners, noting that they don’t look as compelling as those found offshore.

According to the fund manager, overseas gold miners are offering an “amazing combination” of expanding margins, cash flows and impressive balance sheets.

As such, he believes that some of these companies still look very attractive even if the gold price were to drop from current record levels to somewhere in the “high two thousand” an ounce.

Landau listed Toronto-listed gold miner K92 Mining (TSX: KNT) as one standout, noting that while other global gold miners expect to increase production between 50% and 100%, it is on track to triple its production.