Investment themes FOR 2023
High Inflation and rapid Interest Rate increases have resulted in a race to liquidity as the market expectations are for a recession in 2023. While this increases volatility in the short-term, it does not derail medium to longer term themes.
Gold Prices Should Rise
Gold and gold equities usually outperform other asset classes during a recession. This coupled with an inflationary environment should be positive for gold.
“Strong” Metal Prices
Effectively flat metal prices should see quality producers generate strong cash flow presenting opportunity at current valuations. Also, stronger balance sheets could drive increased M&A activity.
Producers with funded organic growth plus Developers with scale
Government Incentives for Electrification
The push to reduce carbon emissions creates demand for some metals. Electric grids need overhaul, leading to intense demand for metals.
Not All Green Metals are Created Equal
Several metals offer limited quality investment opportunities. Focus on safe jurisdictions & favourable supply demand fundamentals.
Copper, Uranium, PGMs, Nickel, Lithium
Decarbonization is the Trend, But We Are Not There Yet
Under-investment has led to limited new supply, despite demand still increasing. Rising prices have oil and gas producers generating substantial shareholder returns.
Shifting global supply chains is pushing prices higher in the nearterm, while infrastructure limits how much supply can increase.
Quality Oil & Gas Producers, and Integrated Producers.