With the current economic slowdown, many investors are turning to precious metals to help hedge against inflation and protect their savings. In this article, we will explore what precious metals stocks to buy in 2023.
Keep reading until the end, as we will also go over the top 10 gold and precious metal mining stocks you should look out for. Let’s get started!
Where Can You Buy Stocks in Gold and Silver?
If you’re looking to invest in a precious metal stock, you can do so by purchasing an exchange-traded fund (ETF), which is a pooled investment that contains a variety of precious metals or stocks of precious metals mining companies.
After hearing about ETFs, many people have a question on their mind: Where can I buy gold and silver stocks? Well, there are many online brokers for ETF investing, some of which include the following:
- Charles Schwab
- Fidelity Investments
- TD Ameritrade
- Vanguard Group
- E-Trade Financial
The 5 Best Precious Metal Stocks to Buy in 2023
The following are the top 5 precious metal stocks (as of August 2023) to buy in 2023:
iShares Gold Trust Micro ETF (IAUM)
- Expense ratio: 0.09%
- Assets under management: $900+ million
IAUM is the best precious metals stock to buy now. It tracks the gold spot price minus the company’s expenses and liabilities.
This ETF is the lowest-cost physical gold exchange-traded fund on the market, making it a fantastic option for those looking to hedge against inflation.
Franklin Responsibly Sourced Gold ETF (FGLD)
- Expense ratio: 0.15%
- Assets under management: $67+ million
With a year-to-date return of 6.35%, Franklin Responsibly Sourced Gold ETF only invests in gold bullion accredited by the London Bullion Market Association.
The trust ensures commitment toward purchasing responsibly sourced precious metals, making it a good investment option for ethical investors.
iShares MSCI Global Metals & Mining Producers ETF (PICK)
- Expense ratio: 0.39%
- Assets under management: $1.47+ billion
The iShares MSCI Global Metals & Mining Producers ETF tracks the index consisting of global equities of companies that mine, extract, or produce diversified metals, excluding gold and silver.
PICK ETF offers an interesting take on investing in precious metal stocks, as the company aims for broader exposure, including industries like coal.
SPDR S&P Metals & Mining ETF (XME)
- Expense ratio: 0.35%
- Assets under management: $1.78+ billion. Besides investing in silver and gold, the SPDR S&P Metals & Mining ETF allows investors to gain exposure to different precious metal mining stocks, including copper, aluminum, coal, and steel.
With more than 30 companies in its portfolio, the XME fund is an excellent way for investors to move away from gold stocks while enjoying good returns. It has an index dividend yield of 2.07%.
VanEck Rare Earth/Strategic Metals ETF (REMX)
- Expense ratio: 0.53%
- Assets under management: $598+ million
VanEck is a global investment manager with over five decades of experience in the gold and precious metals sector. Although you may not have heard of this fund, REMX takes a unique approach to investing in precious metals.
Instead of investing in traditional precious metals, such as gold and silver, VanEck Rare Earth ETF focuses on by-products of precious or base-metal mining. These may include cerium, manganese, tungsten, and titanium.
Top 10 Gold and Precious Metal Mining Stocks to Look Out for in 2023
When looking for the best precious metals stocks, investors consider a variety of factors, including interest rates, dividend yield, and market cap, among many others.
One of the key performance indicators that investors look out for when identifying potential buying opportunities is the free cash flow yield (FCF yield). A greater FCF yield suggests that the company is generating more cash compared to its market value.
The following are the top 10 precious metals companies (stocks of mining companies) (with good free cash flow yield) you should look out for in 2023:
China Gold International Resources
With an FCF yield of 18.7%, China Gold International Resources is a mining and exploration company registered in British Columbia, Canada. It operates two producing mines in China and is the largest gold producer in the country.
Perseus Mining Ltd. carries out gold production, mineral exploration, and gold project development. It operates three active mines across Edikan in Ghana, and Sissingué and Yaouré in Côte d’Ivoire. The company’s financial health is strong, and it has a 15.3% FCF yield.
Silver Lake Resources
Silver Lake Resources is an Australian-based intermediate gold producer founded in 2004 that is currently being traded on the Australian stock exchange.
It has two operating assets in Western Australia and is on our list of the best precious metals stocks to buy in 2023 due to its operational efficiency.
The company has a 13.7% FCF yield, making it an excellent investment if you’re looking to buy gold stocks and other precious metals.
Northam Platinum Holdings
With operations revolving around the three mines (Zondereinde, Booysendal, and Eland) it owns, Northam Platinum Holdings is headquartered in Johannesburg, South Africa.
Platinum, palladium, and rhodium are the three main precious metals the company mines. Northam Platinum Holdings has a 13.6% FCF yield.
Resolute Mining LTD. is a successful African-focused gold mining company with over a decade of experience exploring, developing, and operating 10 gold mines, producing over 9 million ounces of gold. The company has a strong financial position and a 13.6% FCF yield.
Dundee Precious Metals
Headquartered in Toronto, Dundee Precious Metals INC is an international mining company that acquires, explores, develops, mines, and processes gold and other precious metals.
It is currently operating in Namibia and Bulgaria, with exploration efforts underway in Serbia. The company has a 9.4% FCF yield.
With its head office in Perth, Emerald Resources is an Australian mining company that has one of the best gold development teams in the country.
Since 2016, the company has shifted its focus to acquiring, developing, and mining Cambodian gold mines. It has a 7.8% FCF yield.
Capricorn Metals, another Australian gold mining company on our list, has two active projects within Western Australia: the Karlawinda Gold Project and the Mt Gibson Gold Project. It has high profitability with a 6.9% FCF yield.
West African Resources
West African Resources, headquartered in Australia, engages in acquiring, exploring, and developing mineral resource projects in West Africa. This Australian mining company has a 6.7% FCF yield and great operational efficiency.
Impala Platinum Holdings
Impala Platinum Holdings LTD is a South African holding company that manages several companies that operate on gold, platinum, and other precious metals mines. It has a 6.2% FCF yield, suggesting a healthy financial standing.
Besides the top 10 precious metal mining stocks you can purchase in 2023, here are a few honorable mentions:
- Royal Gold Inc
- Gold Fields Limited
- AngloGold Ashanti Limited
- Torex Gold Resources Inc
- DRDGOLD Ltd
Investing in precious metals stocks has several benefits, including portfolio diversification, hedging against inflation, and steady returns. However, it may offer slow growth, which is why it’s important to have a small portion of your portfolio allocated to precious metal or ETF investing. An experienced consultant can assess your financial situation and provide personalized guidance!