Gold’s Breaking Out—And This Pick’s Built to Outrun It

"Crisis Investing" Issue 3 / March 2025 – Vol 2

Dear Reader,

First off, a big welcome to all our new subscribers. We’ve had a solid influx since our last issue—many of you likely joined after reading Mat Smith’s Trump’s Monetary Reset report. If that’s you, welcome aboard.

If you came in another way, I’d still encourage you to give it a read. In that report, Matt lays out—step by step—how Trump’s team could trigger a financial transformation unlike anything we’ve seen before... with gold right at the center of it.

Given that backdrop, it’s no surprise this month’s issue is all about gold too.

Not only do we have a brand-new gold recommendation for you today, but we’re also doing a full review of every gold position in our portfolio. My hope is that it’ll help you quickly zero in on the companies you're most interested in.

Now, since this issue is fully packed, I’ll keep it brief.

Back in our gold-focused September issue, I was clear-eyed but agnostic about whether gold would hit US$3,000 or US$5,000—but I was certain it was headed much higher in 2025 and beyond. I also remember being genuinely surprised at just how absurdly cheap gold stocks were at the time.

Fast forward to today: gold just keeps punching through new all-time highs… US$2,900, US$3,000, US$3,050, and now over US$3,100.

So yes, the first US$3K milestone is already in the bag. But honestly, with everything that’s happening, I think US$5,000 is a matter of when, not if. And if Matt’s right about Trump’s Reset, we could get there just as fast as we blew past US$3,000.

But what about gold stocks? Are they still mind-bogglingly cheap?

They’re still cheap, but the tide is clearly turning. The HUI Index—which tracks a basket of solid, profitable, dividend-paying gold miners—is now at 360.5, up from 326 in September. That’s a 10.6% gain. Still, it’s a long way from its 2011 peak above 600 (mind you, I'm certain we’ll get there again). Which makes this a great time to load up on quality gold names.

Before I wrap up, here’s a quick chart that ties it all together. It’s the gold-to-oil ratio—basically, how many barrels of oil you can buy with an ounce of gold.

Take a closer look—you’ll see it recently hit nearly 41 barrels per ounce. That’s the highest monthly level on record outside the COVID spike.

And who benefits most when oil is this cheap relative to gold?

That’s right—gold producers.

Energy—especially oil—is one of their biggest input costs. So when gold prices surge while oil stays relatively flat, margins can balloon. And that’s exactly what we’ve seen—gold’s jumped nearly US$1,000 per ounce over the past year, while many producers have only seen costs rise US$100–US$200. You don’t need a calculator to see why that’s a big deal.

But here’s the thing—not all producers are created equal.

Some are saddled with heavy debt burdens, risky jurisdictions, and/or hedging programs that cap their upside. So if you want to capture what’s still ahead in this gold cycle, you need to focus on the highest-quality names.

That’s where today’s pick comes in: a high-performance gold producer that checks all the right boxes.

Happy investing,

Lau Vegys