The precious metals complex is experiencing a surge unlike any we’ve seen since the last great market upheaval. Gold—long touted as the ultimate safe‑haven asset—has captured investor attention on multiple fronts. From record fund inflows to eye‑watering year‑to‑date gains, the setup for smart precious‑metal investors has never been more compelling.
1. Record‑Shattering Fund Flows
Last week alone, investors poured $8 billion into gold‑focused exchange‑traded funds (ETFs) and mutual funds—more than double the previous weekly record set during the 2020 pandemic. This bullish stampede pushed the four‑week moving average of net inflows to $4 billion, another all‑time high. Such massive capital rotation into gold funds signals broad institutional and retail conviction that precious metals will continue to outperform in the face of mounting economic uncertainty.
2. Unprecedented Price Performance
Gold’s price action this year tells the same story: a 29% gain so far, marking its best year‑to‑date performance since 1974. Remarkably, in just under five months, gold has already outstripped its entire 27% return from 2024. For investors wondering if the rally has legs, these numbers suggest strong momentum and a market that’s rapidly repricing gold’s role as both a hedge and an alpha generator.
3. Macro Tailwinds: Rising Money Supply
One of the strongest long‑term drivers for gold is real money supply growth. As the Federal Reserve continues to expand M2 money supply—the broadest measure of liquid money—investors often turn to gold to preserve purchasing power. With M2 still on an upward trajectory, gold’s scarcity and finite supply position it as a natural beneficiary of currency
4. Opportunistic Plays
Several relative‑value opportunities now stand out:
- Gold/Silver Ratio at All‑Time High
Historically, silver tends to outperform gold when the ratio (gold price divided by silver price) spikes above its long‑term average (~70–80). Today’s ratio of over 90 suggests silver remains deeply undervalued. Buying silver or silver miners could capture outsized gains when this ratio reverts toward historical norms.
- Gold/S&P 500 Ratio Near Lows
The current gold‑to‑S&P 500 ratio sits at the lower end of its range, implying one of two scenarios: either gold will continue its advance, or equities face further headwinds. For balanced portfolios, adding gold exposure now offers diversification and downside protection against a potential market correction.
- Gold Miners’ Stocks Undervalued Relative to Gold
Despite gold’s 29% rally, major gold‑miner ETFs (e.g., GDX) are up only about 15%. Miners typically leverage gold price moves—historically outperforming on the upside and underperforming on the downside—so this valuation gap signals potential upside as miners’ margins expand.
Example: Newmont’s Q1 2025 Earnings Preview: Can NEM Strike Gold Again?
Newmont (NYSE: NEM) will report first‑quarter 2025 results on Wednesday, April 23, before the market opens. After last quarter’s impressive beat, all eyes are on whether the world’s largest gold miner can deliver another strong performance and set the tone for the rest of the year.
Last Quarter Recap
On February 20, Newmont reported EPS of $1.40, topping the consensus estimate of $1.07 by $0.33. Revenue came in at $5.65 billion—also above forecasts. With 3.61 million shares outstanding, Newmont’s market capitalization sits at approximately $42 billion.
What Analysts Are Modeling
- Revenue: $4.54 billion (consensus)
- EPS: $0.84 (average estimate) NasdaqYahoo Finance
These figures imply a modest year‑over‑year increase in sales but a pullback in EPS from last quarter’s unusually high base. If Newmont can exceed these lowered estimates, it may trigger a positive market reaction.
Key Metrics to Watch
- Gold Production & Costs
- Q4 2024 saw production of 1.90 million ounces, up 9.2% year‑over‑year. Any further gains in output or reductions in all‑in sustaining costs (AISC) will boost margins.
- Q4 2024 saw production of 1.90 million ounces, up 9.2% year‑over‑year. Any further gains in output or reductions in all‑in sustaining costs (AISC) will boost margins.
- Average Realized Gold Price
- Newmont’s Q1 realized price per ounce will reveal how the rally in gold (up 29% YTD) translates into revenue. Each $50/oz increase can add over $100 million to quarterly top line.
- Newmont’s Q1 realized price per ounce will reveal how the rally in gold (up 29% YTD) translates into revenue. Each $50/oz increase can add over $100 million to quarterly top line.
- Margin Performance
- Investors will focus on AISC and gross margins (ex‑hedging), especially as energy and labor costs normalize post‑pandemic.
- Investors will focus on AISC and gross margins (ex‑hedging), especially as energy and labor costs normalize post‑pandemic.
- Free Cash Flow & Capital Allocation
- With strong cash generation, will Newmont raise its dividend, accelerate buybacks, or reinvest in exploration and acquisitions?
- With strong cash generation, will Newmont raise its dividend, accelerate buybacks, or reinvest in exploration and acquisitions?
- 2025 Guidance
- Any updates to full‑year production outlook, cost curves, or capital‑expenditure plans will be key for setting investor expectations.
- Any updates to full‑year production outlook, cost curves, or capital‑expenditure plans will be key for setting investor expectations.
Catalysts and Risks
- Bullish Drivers:
- Continued strength in gold prices (above $2,200/oz)
- Further cost efficiencies from Nevada and Australian operations
- Potential bolt‑on acquisitions in high‑grade assets
- Continued strength in gold prices (above $2,200/oz)
- Bearish Headwinds:
- Rising input costs (energy, labor)
- Regulatory or permitting delays in key jurisdictions
- A stronger U.S. dollar, which can pressure profit margins
- Rising input costs (energy, labor)
Investor Takeaways
- Beat & Raise Potential: Last quarter’s significant EPS beat sets the bar high, but conservative estimates leave room for upside surprises.
- Yield Appeal: At a current yield near 3%, Newmont remains attractive for income‑seeking investors, provided cash flow remains robust.
- Diversification: As a gold‑centric equity, NEM offers a hedge against market volatility—a trait that could attract fresh inflows if stock markets waver.
Bottom Line: Newmont’s April 23 earnings release will test whether its operational momentum and a buoyant gold price environment can translate into another quarter of strong results. Watch for beats on revenue, EPS, and margin guidance—any positive surprise could spur the next leg higher for NEM shares.
5. How to Play the New Gold Rush
- Core Gold Holdings: Consider broad gold ETFs (e.g., GLD, IAU) or physical bullion for immediate exposure to the rally.
- Silver Leverage: Silver miners’ ETFs (e.g., SIL) or physical silver coins can amplify returns if the gold/silver ratio normalizes.
- Miner Leverage: Add or overweight gold‑miner ETFs (GDX, GDXJ) to capture leveraged upside as miners re‑rate.
- Relative Value Trades: Pair gold longs with S&P 500 hedges (e.g., SPX puts) to capture inter‑market dislocations.
- Active Management with AI: Platforms like Tickeron’s AI‑driven strategies can execute dynamic entries and exits, automatically managing risk and capitalizing on short‑term momentum swings in precious metals.
Conclusion
Gold’s current run—fueled by record inflows, historic price gains, and an unstoppable rise in money supply—has ushered in a modern‑day “gold rush.” But savvy investors will look beyond the bullion itself, exploiting ratios and using hedged strategies to maximize returns while protecting against tail risks. Whether you’re a long‑term allocator or an active trader, the opportunities in precious metals today have the potential to shine brightly in your portfolio.