Going back several months ago, I identified NG stocks as being way undervalued and bought early, but since my call of 3/6 they have done very well. The next sector that is getting undervalued are gold stocks. The ones that float my boat are: ABX(although don't buy until Chile mine issue gets resolved), GG, KGC, NEM and MUX. All buy MUX have decent dividend yields and PEs below 10.
With today's deflationary scare, bonds up around the world commodities down, the policy responses will be more QE from central banks, with the ECB actively easing by summer. Eventually all this liquidity will lead to higher inflation.
Bottom line, take partial positions now (1/3), and continue to accumulate as gold back up to $1250-$1350.
Commander, as you know the miners have drastically underperformed bullion over the last six months. Going forward you see that trend reversing? Also, if Golden Sacks wants $1250 gold, aren't they likely to get it?
Unlike GLD, gold stock have dividends, which will act as a brake on the downside. GS maybe correct and I have also expected a bottom in the range of $1250-$1300 in recent weeks, that Is why I suggest buying in stages-perhaps every $75. So, today under $1500, at $1425, at $1350 and then $1275 if prices get to these levels.
I bought some KGC and MUX today. Will buy GG, NEM and MUX at $1425.