Monthly report (NO17 Gold) – March 2025

Monthly fund update

Key points

• NO17 Gold ended March up 17.0% (in Australian dollars, unhedged). In US dollar terms, this equated to up 17.7%, outperforming its benchmark (the universe of gold miners) and gold bullion.

• Gold strengthened as a result of its safe haven status against uncertainty in relation to tariffs and the slowing US economy. It also benefitted from the weaker US dollar.

• The general perception among investors who are not allocated to the sector is that they have missed the rally. This couldn’t be further from our base case.

• Gold mining stocks remain extremely attractive with valuations at what we believe are 25-year lows, notwithstanding a continuing uptrend in the gold price. We see this disconnect as temporary and a significant opportunity which markets are only just beginning to recognise. The launch of various new funds specifically targeting gold miners is a lead indicator that this dislocation will normalise.

• We have a very positive outlook for the price of gold bullion also and there is no change to our belief that gold bullion ETFs are in an accumulation cycle at the same time as central banks are buying gold in volumes not seen since the 1960s.

• The potential for a protracted global trade war (which would be inflationary) at a time when inflation is already elevated and proving sticky, should be motivating investors to identify investments which would stand to benefit from such a scenario. We recall that the second inflation shock in the 1970s resulted in the gold price spiking by 179% over 12 months.