Mark Magarian: We are Extremely Early in this New Bull Market for Gold
Mark recalls seeing the 1987 market crash from his fathers concerned perspective. There were a lot of worried traders at the time, but also some that made off like bandits. This experience showed him that there were always winners and losers in markets and helped shape him into a contrarian investor.
He describes his early career in the late 90’s trading emerging markets primarily eastern Europe and Russia. Most of the companies were resource plays like oil companies that were all trading at huge discounts. This was an exciting time to study businesses with hard assets and real cash flow. Some of the best tools you can use in the industry are history and the understanding of commodity super-cycles.
The current move in gold is still very early, and prices should be much higher based on economics. Most gold companies today are very undervalued.
He discusses the outlook for uranium and copper and how both have supply imbalances. However, both markets require careful timing which can trip investors up. Keep in mind that prices can always worsen and the current economic cycle would dictate that now is a time to remain patient. It’s probably wise to stick with precious metals for the near future.
Writing down your investment thesis and occasionally reviewing your reasons for a trade will help keep you focused. Exuberant feelings toward your trades might well mark the time to take half off the table and find other opportunities. Today is a great time to do your homework by taking a hard look at stock valuations and monetary policies. It may well be in your interest to have an investment in precious metals.
0:40 – Beginning of his interest in finance.
4:15 – How markets have changed and lessons.
8:20 – Where are we today in the bull market?
11:50 – Timing for copper and uranium.
15:40 – Psychology and exiting positions.
Talking Points From This Week’s Episode
• We are still very early in the gold bull market.
• Institutions are just beginning to look at the sector.
• Copper has a supply shortage but could always go lower.
• Uranium has potential, but investors should be in PMs for now.
• Most investors today haven’t even looked at the resource space.
Mark Magarian is Vice President-PIM Portfolio Manager at Wells Fargo Advisors. He has over twenty years of experience as a Financial Advisor.
His multi-asset trading background and strategies include momentum, risk arbitrage, and special situations. His career highlights include working for Deutsche Bank in London as a Vice President and being part of the investment team at Gruss & Co.
His specialties include managing a tactical growth portfolio and creating customized solutions. He is Series 7, 66, and FSA(UK) Registered.