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Boost your portfolio's immunity with Precious Metals

by , 02 June 2020
Boost your portfolio's immunity with Precious Metals
This week we reveal the second last theme in our 6-part series set to perform in the new economic reality, which will evolve as global economies open and start recovering post Covid 19 lockdowns.

Part 5 - Precious Metals:
Precious metals provide diversification that protects your portfolio in bad times. But can also benefit in the good times. Investing in the physical metals and the miners will deliver growth and protection over the long term.
Gold as one of the precious metals is seen as a safe haven in difficult times, it’s a hedge against inflation and convertible into any currency. The Rand price per kilo of gold breached R1 million and is currently hovering just below. Silver hasn’t followed gold higher but we’re starting to see the first shoots of a breakout rally. The Gold-Silver ratio is trading at near all-time highs after breaching the 100-level last week.
The platinum group metals face some uncertainty; however, the basket is selling at record levels in Rand and thus profit outlook remains good. There is still strong demand from China for Palladium and Rhodium.
Amplats force masseur curtailed supply before the Covid-19 impact. Supply remains constrained at a time that vehicle sales globally have fallen and production is expected to fall. This is supportive of the metal’s price. Global car production must decline by around 10% to eliminate the palladium deficit this year.
Preferred buy in this theme is Sibanye Stillwater, it produces both gold and PGMs. And it’s recently signed a deal to refine some of its own PGM concentrate that AngloPlats used it. This will see additional benefit accrue to Sibanye’s Marikana mining operations.
Buy Sibanye (SSW) below R34.00.
Investors can switch some of their DRD profits into SSW as per our previous recommendation in May.

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Invest in a global portfolio of shares with 100% downside protection in USD
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This structured product gives you access to a basket of some of the biggest companies throughout America and Europe, companies like Microsoft, Alphabet, Philip Morris, L’Oreal and Verizon to name a few.
It has a duration of three years and 10 months. Closing date is 10 July and the minimum investment is US$10,000. If you are interested in the above structured product, please email me at trader@protrade.co.za
See you next week.
Gavin McCarter,
Contributing Editor, Money Morning

Boost your portfolio's immunity with Precious Metals
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