A: I don’t think the “boat has set sail” in relation to gold, but it will take further US dollar weakness. A lack of confidence in the USA, the soaring US budget deficit, zero interest rates, weak US dollar and bourgeoning US money supply are the drivers behind the gold price.

 

In terms of playing gold, I prefer ETFs such GOLD, QAU or PMGOLD, or the outright bullion. Shares in gold miners just bring in an addition complication – production issues – and of course, are more leveraged.

 

These are the big 5 gold miners (Newcrest also produces copper), their consensus target prices (from the major brokers), and upside/downside relative to current share price:

 

Newcrest (NCM): target $34.96; last price $31.41; 11.3% upside

Evolution Mining (EVN): target $5.00; last price $5.61; 11.2% downside

Northern Star (NST): target $13.77; last price $13.23; 4.1% upside

St Barbara (SBM): target $3.67; last price $3.29; 11.9% upside

Regis Resources (RRL) : target $5.56; last price $5.25; 5.9% upside

 

Gold miners are not typically big dividend payers. Forecast yields on the above range from 1% to 3.2%.