TMM made the 100 most wanted gold stock
Beyond bullion - World's 100 most wanted, listed, gold stocks
Amid feverish demand, investors remain relatively selective, but risk appetite is clearly on the increase.
Posted: Wednesday , 12 May 2010
JOHANNESBURG -
With gold bullion currently at records in a number of currencies, USD 1,042/ounce in the most widely used quote, investors continue to pile into listed gold stocks, of which there are about 500 across the world. The core reasons for gold's ascent are well known; the longer term price structure hinges on dollar gold bullion's inverse relationship with the dollar itself, a currency which has been in a bear market for a decade.
That has translated to a decade-long bull market for dollar gold bullion. In current markets, the added impetus has come from a sour mix of worries over sovereign debt in the Eurozone, tightening monetary policy in China aimed at undermining a potential property bubble, and Chinese inflation moving to multi-month highs. Traditional safe haven assets have once again been in demand since the apparent crisis in Greece broke out last month; gold bullion, the dollar and US bonds have been in good demand.
Investors in gold stocks have never had it so good. The world's 100 most wanted gold stocks - in rapidly moving markets - have a prevailing combined market value of USD 260bn, collectively worth more than the world's biggest diversified resources stock, BHP Billiton, currently holding a market value of USD 178bn. At the other end of the listed gold market, there are dozens of stocks that are languishing for all sorts of interesting reasons, but those are stories for another day.
At the top end of the most in-demand (rated by a stock's price level, relative to its 12-month performance), sits Crystallex, which apparently holds a fantastic gold deposit in Venezuela. The Canada-based Fraser Institute recently ranked Venezuela as stone last in a survey of 72 mining jurisdictions across the world; the bottom ten include the Congo and Zimbabwe. One respondent said that "In Venezuela, if you actually succeed in making progress with a project, Hugo Chavez will simply nationalize it".
Greece may have lost its sex appeal, but demand for Crystallex suggests that some investors still have a fantastic appetite for specified kinds of risk. The Canadian-listed Crystallex stock price jumped 16% overnight. But there is also excellent demand for a number of global Tier I gold majors, such as Goldcorp and Newmont, along with Barrick, AngloGold Ashanti, Gold Fields, and Agnico-Eagle.
The Tier II group features three African gold diggers in Red Back, Randgold Resources, Eldorado, African Barrick, and Iamgold. A good number of smaller African gold stocks are featured; beyond those mentioned, the likes of Nyota Minerals, Semafo, CGA Mining, Golden Star, Ampella Mining, Avocet Mining, Volta Resources, Resolute Mining, Perseus Mining, Centamin Egypt, Great Basin, Adamus Resources, Orezone, and Keegan Resources.
Demand for a number of listed gold stocks is impacted positively by real or imagined corporate activity; featured names include Lihir,Andean, Red Back, and Underworld Resources.