Trends Watch: Gold and Silver

EisnerAmper’s Trends Watch is a weekly entry to our Alternative Investments Intelligence blog, featuring the views and insights of executives from alternative investment firms. If you’re interested in being featured, please contact Elana Margulies-Snyderman.  

This week, Elana talks with Adrian Day, President, Adrian Day Asset Management.

What is your outlook for alternative investments?   

“Alternative investments” cover a range of different assets.  In general, I would say the outlook is positive, and indeed most have had good performance over the past year or so.  The truth is that with the Federal Reserve creating excess liquidity with abandon, that liquidity has to go somewhere, and people are looking at alternative assets given that much of the broad stock market is trading at highs.

Where do you see the greatest opportunities and why? 

Gold and silver remain my top opportunities on a risk/reward basis.  There may be some that will perform better but with more risk.  Gold, and to a lesser extent silver, are monetary metals and respond to excess money creation. They also respond to higher inflation, which clearly lies ahead.

What are the biggest challenges you face and why? 

Ignoring the allure of what I consider bubbles and focusing on value, and advising clients why they should not succumb to the siren calls of speculations that continue to move up. The biggest challenge however is definitively the increase in illogical and often idiotic, bureaucratic compliance requirements, which take a lot of time and energy that could be better focused on servicing clients.

What keeps you up at night?  

One can’t time a top, but we know that when markets are overvalued and frothy, declines can be sudden and sharp.  So getting the right balance between participating in a market that continues to go higher, and attempting to limit risk from the inevitable.

The views and opinions expressed above are of the interviewee only, and do not/are not intended to reflect the views of EisnerAmper.