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Thursday, 11th May 2006 (6134 views)

Investing in gold mining stocks could prove a much more rewarding investment than investing in the precious metal itself.

Much has been made about the rising price of gold metal, however experts believe that mining stocks, if discreetly and shrewdly purchased, could be worth much more.

A $1 million investment in gold a year ago would now be worth $1.6 million.

However an identical investment in Graham Birch's Gold & General Fund of mining stocks would have more than doubled - to $2.3 million.

This is due to the fact that mining companies are consistently outperforming the commodity they sell as their profits rise faster than the metal's price.

Speaking to Bloomberg, Mr Birch offered advice to potential investors: "If you feel cautious, invest in bullion, if you feel brave, go for gold equities."

In other areas of the commodity market the story is very different.

The value of copper has increased so dramatically in recent months that two pence coins minted before 1992 (when the Royal Mint lowered copper levels) are now worth three pence.

 

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