5-star gold funds

January 13, 2017 08:53 AM
U.S. Global Investors’ gold-oriented funds earn 5-star ratings from Morningstar


U.S. Global Investors, Inc. (NASDAQ: GROW), a boutique registered investment advisory firm with longstanding experience in global markets and specialized sectors, is pleased to announce positive recognition for its funds by Morningstar. The Gold and Precious Metals Fund (USERX) has earned a 5-star Overall Rating by the respected investment ranking and analysis firm, as of December 31, 2016. The fund was rated among 71 Equity Precious Metals funds, based on risk adjusted returns.

The World Precious Minerals Fund (UNWPX) was also honored with a 5-star rating over the three-year period, and the institutional class of the World Precious Minerals Fund, with the ticker UNWIX, claims a 5-star rating over the three-year period. Both fund classes were rated among 71 Equity Precious Metals Funds, based on risk-adjusted return, as of December 31, 2016. The company notes that these funds have had periods of both positive and negative performance in recent years, and performance information can be found on the fund website at www.usfunds.com.

The year 2016 was good for gold investing. Gold bullion had its best first half of the year since 1974, when it surged 28 % for the year through early July 2016, largely driven by low government bond yields in the U.S., U.K., Germany, France, Australia, Japan and elsewhere. The company’s research shows that historically, gold has performed well in low-interest rate environments, and 2016 was no exception. The price of gold bullion finished the year up 8.56 %, according to data from Bloomberg. This reverses the trend over the previous three years, when gold was negative.

“I am proud of our two gold funds for earning the positive results from Morningstar. As I’ve pointed out to investors before, it’s important to take note of what I call the Fear Trade for gold. We are seeing negative real rates, driven by higher expectations for inflation. To remind readers, real rates come from subtracting inflation from the federal funds rate. As investors look for a hedge against inflation, they look for gold,” notes Frank Holmes, CEO and chief investment officer of U.S. Global Investors.

Gold miners benefited even more than bullion in 2016. The group, as measured by the NYSE Arca Gold Miners Index, finished the year up 55 %, beating the other asset classes as shown in the chart below.

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About the Author

Frank Holmes is CEO and chief investment officer of US Global Investors. This first appeared in his Frank Talk blog. For more updates on global investing from Frank and the rest of the U.S. Global Investors team, follow on Twitter at www.twitter.com/USFunds or like on Facebook at www.facebook.com/USFunds.