The outlook for the resources sector is generally positive, but not without its challenges

Pengana Capital Group

Pengana Capital Group

The outlook for the resources sector is generally positive, but not without its challenges. A more sombre pricing environment for bulk commodities will be a headwind for producers whilst base metals and gold prices appear to have bottomed. The sector has produced very good gains in the past 12 months despite significant headwinds. Mergers and acquisitions have picked up recently and we expect that trend to continue over the next 12 months. Overall, the performance of small-capitalised resource companies has lagged their larger counterparts with the S&P/ASX 200 Resources Accumulation Index gaining 16.2% compared to the S&P/ASX Small Resources Accumulation Index which gained 11.9%. We see significant undervaluation in specific situations within the small capitalised resources stocks and as a result expect the gap between large and smaller capitalised stocks to close over the next 12 months and have positioned the Fund accordingly. - quarterly report: (VIEW LINK)


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Pengana Capital Group
Fund Manager
Pengana Capital Group

Pengana Capital Group (ASX: PCG) is an ASX listed diversified funds management group specialising in global and Australian managed funds, with distinct investment strategies that aim to deliver superior risk-adjusted returns to investors.

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