Precious metals will keep shining – buy these funds to take advantage

Data on volatility suggests that a V-shaped recovery may not happen, so hold gold or silver.

Gold mine dump truck © Paula Bronstein/Getty Images
Gold miners have performed strongly since March, but are still worth a look © Getty
(Image credit: Gold mine dump truck © Paula Bronstein/Getty Images)

Precious metals and related investments are supposed to be a hedge against extreme market turbulence. But does the evidence actually back up this contention? I decided to crunch the numbers.

I concentrated on the immediate aftermath of a huge spike in stockmarket volatility. What I wanted to know is if you’d switched out of equities into precious metals-related structures at the end of a bumper day of market volatility (measured by a US index called the Vix, the so-called “fear gauge”), would you still be sitting on decent profits three months later?

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David C. Stevenson
Contributor

David Stevenson has been writing the Financial Times Adventurous Investor column for nearly 15 years and is also a regular columnist for Citywire. He writes his own widely read Adventurous Investor SubStack newsletter at davidstevenson.substack.com

David has also had a successful career as a media entrepreneur setting up the big European fintech news and event outfit www.altfi.com as well as www.etfstream.com in the asset management space. 

Before that, he was a founding partner in the Rocket Science Group, a successful corporate comms business. 

David has also written a number of books on investing, funds, ETFs, and stock picking and is currently a non-executive director on a number of stockmarket-listed funds including Gresham House Energy Storage and the Aurora Investment Trust. 

In what remains of his spare time he is a presiding justice on the Southampton magistrates bench.