Gold Keeps Setting New Record Prices. So Where Are the Investors?

Gold is hitting records in more ways than one.

In nominal terms, the yellow metal set multiple new all-time highs last week, and today, the metal exceeded $3,400 an ounce for the first time ever. On an inflation-adjusted basis, gold also notched a new record price, surpassing the longstanding record set in 1980.

There could be further gains in the coming months, if analyst expectations come to fruition. Goldman Sachs sees gold topping out at $3,700 by the end of this year and $4,000 an ounce by mid-2026.

Top Performing Gold Stocks Now Featured in the IBD 50

Gold miners, I’m happy to report, also appear to be back in favor. The IBD 50, Investor’s Business Daily’s flagship screen of growth stocks, now includes about a dozen gold mining names. Companies that were just added to the list include DRDGold, Eldorado Gold, Gold Fields, Randgold Resources, Osisko Gold Royalties, Royal Gold, Triple Flag Precious Metals and Wheaton Precious Metals.

We’re proud to hold shares in 11 of these companies across one or more of our gold equity or resource funds, as of March 31. Below is a comprehensive list.

Worst Start on Record for the Dollar Index Spurs Gold Buying

This gold rally is classic Fear Trade. It comes as investor sentiment has collapsed to its lowest level in three decades, according to April’s BofA Global Fund Manager Survey. Eighty-two percent of participants said they believe the global economy will shrink, marking the most pessimistic reading in the survey’s history.

The value of the U.S. dollar, when measured against a basket of world currencies, has sunk to a three-year low as traders await more details on the fallout from President Donald Trump’s trade war. The ICE U.S. Dollar Index is down 8% so far in 2025, making this the worst start to a year in the index’s four-decade history, according to the Wall Street Journal.  

Granted, a weaker greenback has its advantages: It makes the price of goods being exported out of the U.S. more affordable to foreign buyers, helping exporters.

My concern is the reason for the dollar’s decline. Foreign central banks have been dumping U.S. debt for a while, but the selling pressure of longer-dated bonds has increased in recent months. In the four months through February, overseas institutions sold a combined net of approximately $90 billion.

Retail Investors Still Missing Out on the Gold Rally

Despite the rally, retail investors are still sorely underexposed. Gold-backed ETF assets currently represent less than 2% of all ETF assets, down from approximately 8% in 2011. Investment in gold ETFs has significantly picked up since February, but holdings are still off by about 19% from their highs in October 2020.

The market share for gold mining ETFs is even lower, representing less than 0.5% of total equity ETFs. That’s a shame because gold stocks have been among the best bets of the year so far. The NYSE Arca Gold Miners Index, or GDM, has advanced roughly 50% through Thursday’s close, far outperforming the S&P 500, which has lost close to 10% over the same period.

Believe it or not, the best-performing S&P 500 stock so far this year is Newmont, the world’s largest gold mining company. Newmont is up a little over 50% through April 17, followed by CVS Health, up 47%.

Analysts have rosy expectations for Newmont’s year ahead. Those polled by FactSet say they project profits to rise 13% to $3.92 per share this year, followed by an 8% rise to $4.23 per share next year.

South African Gold Stocks Break Records in 2025

This rally isn’t limited to U.S.-based gold stocks. South African producers, as measured by the rand-priced FTSE/JSE Precious Metals and Mining Index, hit a new record high as the price of gold has exploded to the upside, crossing above R60,000 per ounce this month for the first time ever.

Many American depository receipts (ADRs) of South African producers have done exceptionally well so far in 2025, with Sibanye Stillwater up about 50%, AngloGold Ashanti and DRDGold both up 93% to 94%, and Harmony Gold up a remarkable 113%.

Gold Stocks Remain Deeply Undervalued Relative to the Market

Just as investors’ portfolios are underexposed to the yellow metal, gold mining stocks look incredibly undervalued relative to the market. The chart below shows the ratio between the GDM and the S&P 500. You can see that, relative to the S&P, gold stocks have traded in a range-bound pattern going back about 10 years.

So how do mining stocks break out of this pattern? Either gold equities continue to trade up, or the S&P 500 continues to fall (or a combination of the two).

In any case, this could be a good buying opportunity. As always, I recommend a 10% weighting, with 5% in physical gold (bars, coins, jewelry) and the other 5% in high-quality gold stocks.

Interested to learn what gold-focused funds we offer at U.S. Global Investors? Simply email “GOLD” to info@usfunds.com.

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The FTSE/JSE Precious Metals & Mining Index is a South African stock market index that tracks the performance of companies primarily involved in precious metals and mining. The NYSE Arca Gold Miners Index is a modified market capitalization-weighted index comprised of publicly traded companies involved primarily in the mining for gold and silver. The S&P 500 is widely regarded as the best single gauge of large-cap U.S. equities and serves as the foundation for a wide range of investment products. The index includes 500 leading companies and captures approximately 80% coverage of available market capitalization. The ICE U.S. Dollar Index (USDX) futures contract is a leading benchmark for the international value of the US dollar and the world’s most widely-recognized traded currency index. The IBD 50 is a weekly, computer-generated stock index published by Investor’s Business Daily (IBD) that identifies the top 50 growth stocks based on fundamental and technical indicators.

Holdings may change daily. Holdings are reported as of the most recent quarter-end. The following securities mentioned in the article were held by one or more accounts managed by U.S. Global Investors as of 3/31/2025): Alamos Gold Inc., Triple Flag Precious Metals Co., Royal Gold Inc., DRDGold Ltd., Eldorado Gold Corp., Osisko Gold Royalties Ltd., Newmont Corp., Wheaton Precious Metals Corp., Gold Fields Ltd., Agnico Eagle Mines Ltd., Harmony Gold Mining Co. Ltd., AngloGold Ashanti Plc.