Shares & the stockmarket

Gold mining stocks: How to research them properly

Gold mining stocks can offer greater exposure to rising gold prices - but they can also carry significantly greater company-specific risks.

In this video, Russ Mould explains how to research gold mining stocks and the key factors investors should consider before deciding whether individual miners could have a place in a portfolio.

Gold itself does not generate cash flow or income, while gold miners have operating costs, assets, debt, management teams and exposure to the countries where they operate. That makes researching the individual company particularly important.

In this video, we cover:

  • Why investors might consider gold miners rather than gold itself 
  • How operational gearing can amplify movements in the gold price
  • The importance of a miner's reserves and production profile
  • Country and resource-nationalism risks
  • All-in sustaining costs (AISC) and why they matter
  • Management experience and the balance sheet
  • How to think about gold miner valuations
  • Examples of London-listed gold and silver miners
  • How funds can provide diversified exposure to gold mining stocks

Russ Mould also looks at why gold miners have historically traded at a discount to gold and what investors should consider when assessing that valuation.