Why gold remains the market’s ‘biggest trade’23 Feb 2026 05:27
STOCKHEAD, - 22 hours ago:
Investors not directly invested in gold bullion and miners are underweight on “the biggest trade in global markets presently and should be looking for dips” says a prominent Australian fundie.
Roscoe Widdup, who runs Triple Eight Capital’s Energy Vision and NO17 gold funds, says the gold price can still go higher, opening further upside for gold miners he says are trading at discounts to historic valuations.
Those comments come in a note attached to the firm’s latest fund update, with T8’s NO17 fund adding 5.7% in January (against 7.6% for its benchmark and bullion) after a 151.1% uptick across 2025 (vs 137.9% benchmark, 51.2% bullion).
Widdup says a host of factors – US Government debt, concerns over US treasuries, and a perfect storm of both elevated central bank and ETF demand – mean gold should push higher after consolidating around US$5000/oz.
Bullion was fetching around half of that at the start of the second Trump presidency.
“The recent strengthening of the gold price (and therefore expansion of gold mining profit margins) has not been reflected in stock prices,” Widdup said.
“We believe this is on account of the fact that it has been easy to ignore the sector for the last 10-12 years, since the peak of the last cycle and a run of disappointments.”
Undervalued
While the world’s top five gold miners were trading on 29 times forward price to free cashflow in 2011, relative to fair value of 20-22 times, Widdup says the same cohort is on less than 10x currently.
“Gold miners have remained off the radar for the majority of investors on the basis that they are immaterial within global equity indices, technically complex, deeply cyclical, and have been overshadowed by miners exposed to more exciting metals such as copper, lithium, rare earths and uranium, etc.,” he said.
“We believe one of the factors contributing to the dislocation is the apparent divergent forecasts for the gold price between gold bullion traders and gold mining equities analysts which we have examined in a separate report.
“When it comes to forecasting the gold price, we encourage investors to consider the forecasts from the banks which actually trade gold bullion (and are therefore qualified to opine on it). This cohort of banks are upgrading forecasts to levels much higher than the current spot price on a 12-month view.
“We see this disconnect as temporary and a significant opportunity which markets are only just beginning to recognise. We believe a normalisation (a mean reversion of valuation multiples on gold miners back to long term norms) is inevitable driven by the bull market in gold bullion and equity investors seeking gold mining equities’ strong fundamentals and compelling valuations.”
It’s not just the big US investment banks who play heavily in the bullion market who have been lifting price forecasts.
Westpac was the latest Aussie bank to lift their’s this week, predicting a top this year
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