(Written by Rebecca Lipman. List compiled by Eben Esterhuizen, CFA. insider data sourced from Yahoo! Finance.)
Climbing gold prices have increasingly drawn attention from investors of all ages, but none more so than those in their 20s and 30s.
Understandably, these young investors are more sceptical than the average speculator. In their short lifetime they have witnessed several market booms and busts, from the dot com, housing and credit bubbles, to global financial and government crises. They also worry about currency debasement, inflation, and unbridled government spending. And unlike the older generations which more-or-less have faith in equities, these investors are more likely to consider alternative investments.
It is therefore no surprise that gold, with its stellar track record and reputation as a store of wealth, has appealed to the newest generation of investors, or as what MarketWatch refers to as Generation Au.
Divnain Malik, head of retail sales at Gold Bullion International, a seller of physical gold in New York, told Market Watch the 25 to 35-year-old age bracket is the firm’s fastest growing segment of buyers. “Over the past two months, about half of the hundreds of new accounts opened at his firm were from people in their 20s and 30s.”
He adds that younger investors are increasingly sophisticated and protective of their investments. Malik notes that for them, “it’s not about the risk in gold, it’s the risk anywhere else.”
This idea has been backed by studies that show a large percentage of young precious-metal investors are college-educated “with only a small portion owning gold for doomsday scenarios,” according to Jeffrey Christian, managing director of CPM Group in New York. There are also an increasing number of females investing in metals, a finding “consistent with broader trends of women taking the lead in family investing decisions.”
Of course, the high price of gold, roughly $1,800 an ounce, serves as a hindrance for young investors who are commonly weighed down with student loans and various other financial obligations. But they have found ways around this hurdle by investing in alternatives like exchange traded funds backed by gold, or gold mining stocks (which are lagging behind in the uptrend), or bullion coins.
So are you looking for investing ideas with an exposure to gold prices?
To help you get started, we collected insider trading data for about 56 gold mining companies, and identified 3 companies that have seen significant insider buying during the current quarter.
These insider executives are using their own money to buy the shares of their employers. This is significant, especially when you consider that these insiders know more about their businesses than most investors.
Use this list as a starting point for your own analysis.
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1. Midway Gold Corp. (MDW): Engages in the acquisition, exploration, and development of mineral properties in North America. Over the last six months, insiders were net buyers of 100,000 shares, which represents about 0.13% of the company’s 76.63M share float.
2. US Gold Corporation (UXG): Engages in the exploration for, development of, production, and sale of gold, silver, and other precious metals. Over the last six months, insiders were net buyers of 3,067,000 shares, which represents about 2.85% of the company’s 107.76M share float.
3. Vista Gold Corp. (VGZ): Engages in the evaluation, acquisition, exploration, and advancement of gold exploration and development projects in Australia, North America, and Indonesia. Over the last six months, insiders were net buyers of 29,500 shares, which represents about 0.05% of the company’s 62.40M share float
Interactive Chart: Press Play to see how analyst ratings have changed for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.