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What do the top hedge fund and mutual fund gurus like in the gold and silver mining Industry? This article, the eleventh in a series, identifies through research of the latest available institutional 13-F filings the gurus who are most invested in the gold and silver mining Industry, and the specific gold and silver mining companies which they prefer to hold in their hedge fund portfolios. The first 10 articles in the series identified gurus who are over-weight in the solar sector, utilities sector, China stocks, airline sector, optical networking sector, chemicals industry, oil and gas exploration industry, the automobile industry, the biotech industry and the consumer non-durable goods sector, and the stocks within those sectors that they hold in their portfolios (for those familiar with the series, skip over to the fifth paragraph).
A guru is defined as someone who is regarded as having great knowledge, wisdom and authority in a certain area. When it comes to hedge funds, there are a number of ways to anoint leading managers as gurus including long-term performance, low portfolio volatility and an elite reputation in the investment community.
Many of us are familiar with leading investors and hedge fund managers such as Warren Buffett, George Soros, Carl Icahn and Julian Robertson. But the hedge fund community alone includes over 9,000 funds. Add in mutual funds, ETFs and other investment entities and the number is likely to be at least two to three times that number. While there is no official list of gurus, less than 1%, or between 100 to 200 fund managers, are commonly believed by the larger investment community to have earned the distinction of being called gurus.
The study of the investing habits of gurus can be informative as these are very savvy, well-respected investors with high personal net worth deploying large sums of capital from their funds on a regular basis. They have a long-term track record of success, and while one can easily just ride their coattails, the savvy investor may want to use these lists as a starting point to conduct their own due diligence.
The total capitalization of the U.S. equity markets is somewhere in the $15 trillion range, and the total market capitalization of leading gold and silver mining stocks is approximately $312 billion, or 2.1% of the overall market. The table lists four investment gurus whose funds have invested over five times that or at least 10.5% in the gold and silver mining industry. The following is a list of their picks:
  • Colorado-based Newmont Mining Corp. (NYSE:NEM) produces gold in the U.S., Australia, Peru, Indonesia, Canada, New Zealand, Ghana and Mexico.
  • Canadian companies: Barrick Gold Corporation (NYSE:ABX) is engaged in production of gold and copper in Peru, Canada, U.S., Australia, Chile and five other countries; Goldcorp Inc. (NYSE:GG) is engaged in mining and exploration of silver, copper and gold throughout North and South America; Kinross Gold Corp. (NYSE:KGC) is engaged in mining and processing gold, silver and copper in the U.S., Brazil, Ecuador, Chile and Russia; and Novagold Resources Inc. (NYSEMKT:NG) is engaged in the exploration and development of mineral properties in Alaska and British Columbia; Iamgold Corp. (NYSE:IAG) is engaged in the acquisition, exploration and development of gold mines in Africa, South America and Canada; Ivanhoe Mines Limited (IVN) is engaged primarily in the exploration of gold and copper mines in Central Asia and the Asian Pacific region; and Northern Dynasty Minerals (NYSEMKT:NAK) is a miner of copper, gold and molybdenum porphyry from one mine in Alaska.
  • South African mining companies: Gold Field Ltd. (NYSE:GFI) is engaged in the exploration and extraction of gold in South Africa, Ghana, Australia and Peru; Harmony Gold Mining Co ADR (NYSE:HMY) is mining gold in South Africa; and Anglogold Ashanti ADS (NYSE:AU) is producing gold with 21 operations in 10 countries on four continents.
  • Channel Islands-based Rangold Resources ADR (NASDAQ:GOLD) engaged in the exploration and development of gold properties primarily in Mali and Cote D’Ivorie.
Table
Fund and Guru
Type of Fund
Assets Under Management
Percent Portfolio in the Gold and Silver Mining Industry
Major Gold and Silver Mining company positions in Portfolio
Touradji Capital Management, LP (Paul Touradji)
Hedge Fund - Commodities Focused
$ 2.5 billion including $280 million in Equities
35.9%
ABX
Perella Weinberg Partners Capital Management LP (Dan Arbess)
Hedge Fund - Multi-Strategy
$4 billion including $1 billion in equities
18.4%
IVN, ABX, NAK
First Eagle Investment Management, LLC (Jean-Marie Eveillard)
Mutual Fund
$ 19.7 billion
13.4%
GFI, NEM, HMY, AU, GG, ABX, KGC, IAG, GOLD
Paulson & Co, Inc. (John Paulson)
Hedge Fund – Multi-strategy
$ 29.3 billion
11.5%
AU, GFI, KGC, NG
Touradji Capital Management, LP, is a commodities-focused hedge fund founded by Paul Touradji. He previously worked as a trader from 1996 to 2000 in Julian Robertson's legendary Tiger Management.
Perella Weinberg Partners, a hedge fund, founded by Joseph R. Perella and Peter Weinberg in 2006, has $4 billion AUM including over $1 billion in equities, and employs a multi-strategy approach.
Jean-Marie Eveillard is Senior Investment Adviser for First Eagle Investment Management, a $19.7 billion Mutual Fund company. He served for more than a quarter century as a portfolio manager, and was co-honored in 2001 by Morningstar as “Stock Manager of the Year.” He invests using a bottom-up value-oriented approach.
John Paulson, founder and president of Paulson & Co., a New York-based Hedge Fund, manages several hedge funds for the company. In 2007 alone his firm earned $15 billion mostly capitalizing on the foreclosure and mortgage backed securities (MBS) markets.
Credit: Historical fundamentals including operating metrics and stock ownership information were derived using I-Metrix by Edgar Online®, Zacks Investment Research, Thomson Reuters and Briefing.com. Fund data including assets under management and firm profiles are sourced mostly from Hedgetracker.com. The information and data is believed to be accurate, but no guarantees or representations are made.
Disclaimer: Material presented here is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion. Further, these are my opinions and I may be wrong. I may have positions in securities mentioned in this article. You should take this into consideration before acting on any advice given in this article. If this makes you uncomfortable, then do not listen to my thoughts and opinions. The content of this article does not take into consideration your individual investment objectives so consult with your own financial adviser before making an investment decision. Investing includes certain risks including loss of principal.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Source: Top Gold and Silver Mining Picks by Hedge Fund and Mutual Fund Gurus