Sprott: Investors Should Use Gold as a Diversification Strategy

Peter Grosskopf, CEO of Sprott (TSX:SII,OTC Pink:SPOXF), addressed where gold stands in a presentation at Mines and Money New York last week, speaking about what a tough month it has been for gold producers, but reassuring investors of the importance of holding the yellow metal. 

In an interview at the sidelines of the show, he spoke further about why investor sentiment around the gold space is at an all-time low and what he believes is currently affecting yellow metal prices.

“I don’t think I’ve seen (investor sentiment) any worse,” he said. “It’s not just that gold has been lackluster compared to the other global financial markets. It’s also that there have been some changes in asset management, which have made sector funds like gold very unpopular.”

Despite what Grosskopf called a “vicious downward circle,” he believes that the current gold climate has created some “incredible buying opportunities.”

As for what is currently shaking the price of gold, Grosskopf thinks it has to do with stocks and bonds.

“Gold is like a chameleon. It assumes an identity to different assets at different times, and right now, I think it’s more related to the stock market and the bond market than anything else. If the stock and bond market is doing well, like it is now, gold is sinking,” he noted.

Overall, Grosskopf remains optimistic about the yellow metal, telling the Investing News Network that it’s a very good time to get into gold from a diversification standpoint.

“I think it’s very prudent and sensible now, from many perspectives, for investors to move a bit of their wealth, and particularly a bit of their cash, into gold as a diversification strategy,” he commented.

Listen to the interview above for more of Grosskopf’s thoughts on the precious metal. You can also click here to view our full Mines and Money New York playlist on YouTube.

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Securities Disclosure: I, Nicole Rashotte, 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.