PI's pair trade Barrick vs Kl
PI's citing of Eric Sprott's recent selling made me wonder about recent insider selling at Barrick.
There doesn't appear to be any recently probably due to all the merger and joint venture activity.
There was some institution selling before that though , Four different Templeton Funds sold a total of 13.8 million shares in late Dec 2018 and early Jan 2019.
A three year chart comparison between ABX and KL show
total share price gain at Barrick -2.19%
at KL +770%
If we have a fall in the gold price there may be more danger to KL's price than Barrick's but I think there is more likely to be a rise in gold price ahead as the overall stock market and ecomomy in general turn down as the recent inverted bond yeild and high valuations scare the longs.
If there is a spike in gold price I would much rather be in KL which has a far better AISC and should see a lot of dollars hit the bottom line. Barrick could have leverage because of it's poor past performance , perhaps the Nevada joint venture can save some costs by cutting employees but I doubt it will grow its rescources much whereas KL has great potential for rescource growth at Fosterville.
My bet is solidly with KL even if Proud Italian's theories are correct I still think KL will do well but I would hate to waste money trying to get a short term pair trade gain and then watch KL shares zoom up and get out of reach while I was left holding a long term loser.