VIDEO - Peter Grandich: Risk/Reward for Gold, Metals to Win the Electrification Race
“The gold market may be in the fourth or fifth inning of a nine inning game,” said Peter Grandich of Peter Grandich & Company.
The first two months of the year have been rough for gold. After rising to around US$1,950 per ounce in January, the yellow metal has trended downward and began March at about US$1,735.
Peter Grandich of Peter Grandich & Company said that while gold’s correction since last summer’s all-time high has gone on longer than he expected, it’s not necessarily cause for concern.
He explained that gold has faced a variety of headwinds since then, including profit taking and bitcoin enthusiasm. That has hurt sentiment in the space, but he expects an improvement.
“The gold market may be in the fourth or fifth inning of a nine inning game, and I think we’re pretty close to the end of the correction. I would say the risk is US$100 down and the reward is US$500 to US$1,000 up,” Grandich commented to the Investing News Network.
Aside from gold, Grandich is looking at metals related to the electrification theme.
He noted that he’s become increasingly interested in uranium — while he did recently take some profits in the space, Grandich was clear that he did so with the intention of building his cash position, not because he isn’t confident in the commodity’s future.
“In 2021, we’ve seen a real breakout in a lot of uranium (stocks), but I actually in recent days took some profits. Not because I think the run is over, but because I wanted to build cash — I am truly the most petrified in 37 years … in and around this financial world. I’m definitely afraid of the stock market, the general stock market. I wanted to raise some cash, so I took some profits in uranium stocks,” he said.
Grandich also thinks copper will play a major role in the electrification story, and said he favors the red metal over other more typical battery metals like lithium and cobalt due to issues on the supply side.
“The argument for copper is there’s been such a neglect of seeking it, and the deposits that are out there are high CAPEX, high cost (and) in areas of the world that are not the best places to work anymore,” he said. “There’s going to be a real need to spend a lot of money, and it’s not something you can just start tomorrow and have it available in a few days, a few weeks or a few months. It’s going to take several years, and I think that’s what the market is reacting to now.”
Watch the interview above for more from Grandich on gold, uranium and copper.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.