Q: Hello
with the war in Iran
and the situation re: oil tankers unable to get through the narrow Strait of H
how does it affect the price of gold and silver, if you think gold and silver will continue to go up with if inflation under or out of control and a weak US dollar
how does it affect Uranium stocks like CCO as a long term energy alternative
thanks
Michael
with the war in Iran
and the situation re: oil tankers unable to get through the narrow Strait of H
how does it affect the price of gold and silver, if you think gold and silver will continue to go up with if inflation under or out of control and a weak US dollar
how does it affect Uranium stocks like CCO as a long term energy alternative
thanks
Michael
5i Research Answer:
Gold and silver have been a bit weaker, but not because of the price of oil but rather because the US dollar has found strength. In times of crisis, scared investors move money to the US dollar. This can negatively impact gold as gold and silver are priced in US$. This is also true for uranium and most commodities, so CCO can also be impacted by this. BUT......world tensions should ultimately be net positive for gold and silver. The supply-demand imbalnce in uranium should also not be negatively impacted by the war (and could in fact get worse). Thus, other than for managing position sizes, we would not make big adjustments to a precious metals position or a CCO position.