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Summary
- Due to Covid-19 Investors have turned sceptic about investing their money
- Investing in gold stock has become an excellent idea as it provides growth apart from being a safe haven
- Gold has surged to a new high of over US$ 1,900 per ounce, the highest level in the last eight years.
The economic condition of the world has been changing drastically. The unprecedented outbreak of the pandemic has devastated the world economy, claiming several lives. Sectors such as hospitality, travel, tourism, and leisure have been severely impacted due to this. Investor's wealth has eroded significantly in just a couple of months. In addition, negligible economic activity has led to a significant drop in oil prices. Several people are being furloughed or have lost jobs amidst the lockdown restrictions. Due to lack of clarity, it cannot be predicted as to how the economy will shape up. Investors are sceptical about investing their money. These types of pressure created on the world economy, are helping Gold stocks to historic high. As per market experts, gold prices tend to go higher through various market cycles as seen in the past.
According to the World Gold Council data on the exchange-traded fund (ETF), gold-backed ETFs have delivered positive flow for consecutive seven months in June. Investing in gold stock has become an excellent idea as the price of the precious metal continues to soar high. It has surged to a new high of over US$ 1,900 per ounce, the highest level in the last eight years. The gold was trading at US$1,937.90 on 28 July 2020. Gold has delivered a price return of nearly 27 per cent on Year to Date (YTD) basis.
Let’s look at some of the gold stocks that have been delivering a good YTD return.
Greatland Gold PLC
Headquartered in London, Greatland Gold Plc is a precious metals mining exploration and development company, mainly operating in Western Australia and Tasmania. The company has five mineral projects including the Bromus, Earnest Giles, Firetower, Havieron and Warrentinna projects.
Greatland Gold Plc (LON:GGP) stock last traded at GBX 15.20 on 27 July 2020, up by 6.29 per cent from its previous close of GBX 14.30. The company's 52 weeks low/ high range was reported at GBX 1.57/14.90. It was having a market capitalization (Mcap) of £539.71 million. The stock delivered a positive total YTD (Year to Date) return of 730.60 per cent.
Eurasia Mining PLC
Eurasia is a mineral exploration company primarily focusing on the development of platinum. The company has two licences, namely, West Kytlim in Central Urals, and Monchetundra on the Kola Peninsula in Russia.
Eurasia Mining PLC (LON:EUA) stock last traded at GBX 19.00 on 27 July 2020, up by 5.56 per cent from its previous close of GBX 18.00. The company's 52 weeks high was reported at GBX 19.70. It was having a market capitalization (Mcap) of £517.71 million. The stock delivered a positive total YTD (Year to Date) return of 413.51 per cent.
Altyn PLC
Altyn is a precious metals miner based in the United Kingdom. The company's assets are located in Kazakhstan. It is involved in the production of gold dore.
Altyn PLC (LON:ALTN) stock last traded at GBX 2.46 on 27 July 2020, up by 11.81 per cent from its previous close of GBX 2.20. The company's 52 weeks low/high range was reported at GBX 0.42/2.46. It was having a market capitalization (Mcap) of £63.32 million. The stock delivered a positive YTD (Year to Date) return of 374.40 per cent.
Petropavlovsk PLC
Operating in Russia, Petropavlovsk is a gold mining company. The company is segmented into Pioneer, Pokrovskiy, Malomir and Albyn hard-rock gold mines.
Petropavlovsk PLC (LON:POG) stock last traded at GBX 37.75 on 27 July 2020, down by 4.43 per cent from its previous close of GBX 39.50. The company's 52 weeks low/high range was reported at GBX 9.34/39.50. It was having a market capitalization (Mcap) of £1,251.15 million. The stock delivered a positive total YTD (Year to Date) return of 197.24 per cent.
ECR Minerals PLC
ECR is a mineral exploration company of the United Kingdom, engaged in exploration and development of gold projects in Australia. It is involved in the identification, exploration, acquisition and development of mineral projects.
ECR Minerals PLC (LON:ECR) stock last traded at GBX 2.35 on 27 July 2020, up by 23.68 per cent from its previous close of GBX 1.90. The company's 52 weeks low/high range was reported at GBX 0.45/2.35. It was having a market capitalization (Mcap) of £13.03 million. The stock delivered a positive total YTD (Year to Date) return of 224.14 per cent.
Conclusion
Gold stocks hold the same kind of risks as any other stocks similarly Gold has high growth potential; there are of great opportunities in the market. Gold stocks are a great alternative from the perspective of investing in the precious metal itself. The share prices of gold mining and production companies don't necessarily respond as quickly to changes to the value of gold, indicating they can be an excellent way to hedge exposure to gold prices. There are experts who even believe that gold stocks have the potential to outperform gold itself.
