What makes gold a strategic asset?
Gold benefits from diverse sources of demand: as an investment, a reserve asset, jewellery, and a technology component. It is highly liquid, no one’s liability, carries no credit risk, and is scarce, historically preserving its value over time.
How to value gold for maximum portfolio impact
Gold does not directly conform to the majority of the most common valuation methodologies used for equities or bonds. Without a coupon or dividend, typical models based on discounted cash flows, expected earnings, or book-to-value ratios, struggle to provide an appropriate assessment for gold’s underlying value. This presented an opportunity for the World Gold Council to develop a framework to better understand gold valuation.
Caledonia Mining Corporation plc (LON:CMCL) is a profitable cash generative gold producer with a strong growth profile, Caledonia’s primary asset is the Blanket Mine in Zimbabwe.