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CIO Weekly - Golden Buying Opportunity

Jul. 10, 2017 1:48 PM ETGLD, IAU, PHYS, SGOL, GTU, OUNZ, QGLDX, PHYS:CA1 Comment
Gary Dugan profile picture
Gary Dugan


  • Gold is a steal - don't miss the opportunity now.
  • Asian equities the better quality momentum play.
  • Chinese equities have up to 10% more upside potential this year.
  • Top up your 10 year U.S. government bond holdings into any further price weakness.

Gold is a steal anywhere near the $1200 level. I wonder how much more North Korea is going to have to say or do before investors turn to gold in more numbers. Irrespective of the geopolitical issues we are moving into a seasonally stronger period for gold. My favorite technical analyst Bill Sarrubi at Cycle Research Investments points out that gold has risen more frequently in July than in any other month since 1969. He expects gold to move back to 1240-45 in the very near term before pushing higher from August onwards. September has been the single strongest month in any year. I would remind investors that an allocation of 6-8% as a core holding in gold is appropriate for long-term wealth preservation.

Investor patience is needed in buying global equity markets where last week’s very modest losses of around 0.5% may presage a bout of weakness in the coming six to eight weeks. After a good run, the markets are looking to consolidate. We see any setback in equity markets as a selective buying opportunity in Emerging markets and especially in Asia.

Janet Yellen’s speeches to Congress this coming week are likely to see her continue to set out a mildly hawkish position on the path for further interest rate increases. However economic data later in the week is likely to underpin my view that the U.S. economy is providing insufficient reasons for the market to believe that there will be a sharp tightening of monetary policy in coming quarters. One further rate rise this year looks to be the most likely scenario something that is not going to derail the recovery in Asia or the positive performance seen from emerging market assets since the start of the year.

There are good signs of life in the Asian

This article was written by

Gary Dugan profile picture
Investment professional with 35 years experience of buy and sell side of the banking businesses. I have managed numerous strongly performing investment and advisory teams in large banks in Europe and more recently in Asia and the Middle East. In the early years of my career, I was a portfolio manager covering UK equities. I then moved across to portfolio strategy as a sell-side strategist for Europe at Baring Securities and JPMorgan. The core of my career was the 11 years at JPMorgan where I made Managing Director. At JPMorgan, I moved across to the asset management business in 1998 responsible for multi-asset portfolio management for Europe Middle East and Asia. At JPMorgan, I also provided advice to the Private Banking business. In 2004 I moved to Barclays Wealth as CIO for their European and Asian business. Subsequently, I have held CIO roles at Merrill Lynch Europe), Coutts in Singapore and Emirates NBD and NBAD in the United Arab Emirates. I have a reputation for making bold calls on the markets I made major bear calls on equity markets in 1987, at the top of the tech boom and the financial crisis in August 2007, and a bull call on equity markets on March 17th 2009. I predicted Trump's victory. I am an asset allocator and tactical trader in asset classes I often speak at conferences and provide industry thought leadership on a number of macro and investment topics. In the past, I made a presentation to the European Parliament on the outlook for asset markets after the introduction of the euro.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

I may initiate further buying in gold ETFs

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