Add a Russian commodity hedge fund that doubled investors’ money last year to the list of funds betting on gold.
Specialised Research and Investment Group’s Metal and Mining Fund is buying gold-mining companies in the expectation that the precious metal could soar almost 50% this year.
“$1,500 to $1,700 is not in the realm of craziness,” the fund’s manager, Ryan Dodd, said. Gold currently trades at about $1,100.
“The gold mining companies haven’t looked as attractive in terms of valuations in a year, or even five or six years, if you exclude 2008,” he told Financial News. Dodd credited currency and sovereign debt concerns for the soaring price of gold.
Certainly, Dodd’s track record couldn’t be better. The fund debuted in November 2008, and managed a 37.87% return in its first two months. It’s hot hand continued last year, when the fund soared 106.28%.
“Things were just going up,” Dodd said of the mid-cap companies that made up more than half of his portfolio in 2009. “I picked individual restructuring opportunities and tried to ride the wave higher.”