Investment firm Golden Prospect Precious Metals saw its net asset value (NAV) plunge in the first half after shares in gold mining companies under-performed gold itself.
The NAV of the company opened the year at 97.85p but was 77.67p at the end of June, a drop of 20.6%.
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Golden Prospect blamed the underperformance on a lack of capital discipline at gold companies and "the pursuit of a growth strategy at any price".
"As a consequence, investors have expressed their disappointment and new Chief Executives have been appointed at five significant gold mining companies," said Chairman Malcolm Burne.
The firm cited Barrick Gold, Kinross, Semafo, Centerra Gold and Great Basin Gold, which have all replaced CEOs.
"I foresee greater focus on dividends and the shelving or deferment of expensive projects," Burne said.
Golden said such deferments were crucial in restoring the health of gold mining companies, especially when capital markets were difficult to access.
The company added that investors had not favoured 'risk on' assets, preferring securities perceived as defensive.
Golden said it had increased its weighting in quality producers in both gold and silver miners with good management teams.
It has also taken its explorers' weighting down and is re-positioning the type of explorers in its portfolio to include only those which the company believes have a high chance of being developed or acquired by larger companies in the future.
This was because gold exploration could become much more difficult to finance and the firm believes only projects which indicate high grades and low capital costs were likely to succeed in the future
But the report struck a bullish tone on the outlook for the investor's chosen niche.
"We believe that the macro-environment is very conducive for precious metals securities and hence have taken the opportunity of recent lower share price levels to increase our gearing," said Investment Manager John Wong.
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