Adrian Day

Gold miners have held up well relative to gold, with no heavy selling pressure. Big-cap gold stocks are very undervalued relative to their own histories, and the sector offers attractive leverage to gold with favorable valuations.

Speaker stated they are "certainly increasing the gold exposure" and highlights specific companies like Agnico Eagle for hedging costs and strong management. He notes gold miners' all-in costs are far below current gold prices (~$1350 vs. ~$4500), making them resilient. Gold miners have unprecedented profit margins. Input cost inflation (e.g., from oil) has a muted impact on margins at current gold prices. Geopolitical and financial system stress underpins long-term demand, while disciplined companies offer leveraged exposure. The fundamental setup for gold producers remains highly attractive, with strong leverage to the metal price and manageable cost structures. A severe, sustained liquidity crisis forces broad asset sales, including gold, overwhelming fundamental demand.

Agnico Eagle is trading within 10% of its all-time low price-to-free-cash-flow valuation, which is nonsensical with gold at $4,000. The company is extremely undervalued.

Oil prices are poised to rise meaningfully over the next few years due to global restocking needs, Asian energy security concerns, low inflation-adjusted historical price, and the failure to replace fossil fuels in industrial economies.

Speaker stated "Copper has come off a lot. The copper stocks have fallen quite a bit. So, there's some good... exposure there primarily." The recent price decline in copper and related equities presents a more attractive entry point for a commodity with strong long-term fundamental demand drivers. The pullback is viewed as a buying opportunity to gain exposure to the copper theme. A sharp global economic slowdown, exacerbated by higher oil prices, significantly reduces near-term industrial demand for copper.

Silver has moved up with gold and on some timeframes has outperformed gold. The participation of the more speculative metal and junior miners is a sign of a very positive precious metals market.

Non-US equity markets are trading at 50-year relative lows to the US, and a secular rotation out of US big tech into international value and emerging markets is due. Specific value found in UK, Hong Kong, Singapore, and Brazil.

Ares Capital (ARCC) is the largest and one of the most conservative BDCs, extremely diversified (no loan >2% of portfolio), earning its dividend well, and has ample cash reserves. The stock has corrected but remains a good buy with a covered dividend.

Value has underperformed growth for five years at extreme levels, and a multi-year rotation into value is likely as money rotates out of overvalued growth stocks. Value stocks should outperform.

Foreign markets (World ex-US) have dramatically outperformed the US last year and continue to do so in 2025. The US vs world ratio remains near 50-year extremes, and historical patterns suggest a multi-year period of foreign outperformance ahead.