October 22, 2020
Over the past year, gold appears to have found a larger place in the portfolio of U.S. investors. For instance, Warren Buffett’s Berkshire Hathaway recently invested in Barrick Gold Corporation, while Bridgewater Associates invested in gold-backed ETFs. Globally, gold-backed ETFs now make up approximately 35% of gold demand compared to 8% a decade ago. In some countries, however, such as India and China, gold has not seen a similar increase in demand. In fact, according to the Financial Times, due to weakness in domestic demand and export restrictions, gold is selling at $53.00/ounce less in China than in global markets. In India, gold demand fell by 56% in the first half of this year, although the World Gold Council notes that Indian demand picked up in August.
Midas Fund The Fund’s holding of Maverix Metals Inc., a company that seeks to acquire and manage royalties and metal purchase agreements, performed well in the last month. Shares of OceanaGold Corp, a company engaged in the exploration, development, and operation of gold and other minerals, have underperformed in the last month.
Midas Fund seeks primarily capital appreciation and protection against inflation and, secondarily, current income through investments primarily in precious metals mining and other natural resource companies, as well as gold, silver, and platinum bullion. Using a disciplined approach, the Fund seeks to emphasize gold and other natural resource companies offering financial strength, expanding production profiles, strong free cash flow, and promising exploration potential. The Fund currently is invested in a global portfolio of primarily large and medium gold and diversified mining companies, precious metals royalty companies, and ETFs holding gold and silver bullion.
Midas Magic The Fund’s position in Williams-Sonoma, Inc, a multi-channel retailer of home goods, with both a brick and mortar and online presence, performed well in the last month. The Fund’s holding of Cabot Oil & Gas Corporation, a leading independent natural gas producer with its entire resource base located in the continental United States, hindered the Fund’s performance in the past month. Each of Mastercard Inc. Class A and Alphabet Inc. Class A currently comprise more than 10% of the Fund’s net assets.
Midas Magic The Fund seeks capital appreciation. Relative to the S&P 500, the Fund’s portfolio currently is more weighted in cyclical companies, such as financial services, and is underweight in economically sensitive and defensive industries. The Fund generally focuses on companies that appear to have strong operations showing superior returns on equity and assets with reasonable valuations.
This release may contain certain “forward looking statements” as defined under the U.S. federal securities laws. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will,” “may,” “should,” “plan,” or the negative of such terms, and similar expressions identify forward looking statements, which generally are not historical in nature. Forward looking statements are subject to certain risks and uncertainties that could cause actual results to materially differ from a Fund’s historical experience and its current expectations or projections indicated in any forward looking statements. These risks include, but are not limited to, equity securities risk, corporate bonds risk, credit risk, interest rate risk, leverage and borrowing risk, additional risks of certain securities in which a Fund invests, management risk, risks related to the negative impacts from the continued spread of COVID-19 on the economy and broader financial markets, and other risks discussed in each Fund’s filings with the Securities and Exchange Commission. You should not place undue reliance on forward looking statements, which speak only as of the date they are made. Each Fund undertakes no obligation to update or revise any forward looking statements made herein. There is no assurance that each Fund’s investment objectives will be attained.
Certain information contained herein has been obtained from third parties. While the Funds believe such sources are reliable, the Funds cannot guarantee the accuracy of any such information and does not represent that such information is accurate or complete.