Silver Has The Best Value Out Of All Precious Metals - Columbia Threadneedle
(Kitco News)- Despite its continuedunderperformance within the precious metals market, one global investment firmremains optimistic that silver will regain its luster.
In an interview with KitcoNews, Nicolas Robin, portfolio manager for commodity investments at ColumbiaThreadneedle Investments, said that when interest in the precious metals sectorpicks up, he expects silver to outperform gold.
“Silver is a relative valueplay for us. We think silver has been oversold and we own silver over gold,” hesaid. “The investments that we are looking at right now are assets that havesignificantly underperformed because of trade war concerns and a stronger U.S.dollar.”
Looking at gold, Robin saidthat he is expecting to see lower prices in the near term. August goldcontinues to struggle to find momentum as prices hover around the recent12-month lows. August gold futures last traded at $1,222.60 an ounce, down0.75% on the day. At the same time September Silver last traded at $15.420 an ounce, down 1% on the day.
“We think there is a decentchance that gold breaks below $1,200 an ounce because of further strength inthe U.S. dollar,” he said.
Looking at the U.S. dollar,Robin said that he sees the currency near the top end of its range.
“I think there has been verysignificant short-covering in the U.S. dollar but that appears to be ending andthis should help gold and silver going forward,” he said. “Every negative newson trade has been positive for the U.S. dollar, but a lot of that news has beenpriced in now.”
Along with precious metals,the broad-commodity sector has seen significant selling pressure in recentmonths; however, Robin said that his firm is seeing the opposite as investorinterest has grown. Last month the firm announced that its commodity fund roseto $2 billion in asset under management, the highest amount since the fund waslaunched eight years ago.
While the threat of a globaltrade war has weighed on commodity prices recently, Robin said that investorsare looking past the short-term volatility. He said that his firm remainsbullish on commodities as economic growth remains strong and inflation picksup.
Robin added that the U.S.government could end up resolving its trade dispute with China by the fallahead of the mid-term elections because “President Donald Trump will need tofollow through on promises made to his voters.”
At the same time, Robin said that a prolonged trade war could bepositive for commodities and both the U.S. and China might ramp upinfrastructure spending to support shrinking economies.
By Neils ChristensenFor Kitco News
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nchristensen@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.