If you missed the market rotation mid-last year to gold and precious metal miners, you may be asking if it’s too late to jump on. Recognizing the precious metal positive trend, we started adding gold and silver miners in the first quarter of this year. Gold has become another key asset in our portfolios to diversify our very profitable positions in AI and technology. For reference, we began adding Nvidia (NVDA) in June 2022, which has gained nearly 1000%. Other stocks that have outperformed the S&P 500 these past several years include Palantir (PLTR), Arista Networks (ANET), Invesco QQQ Trust (QQQ), and SPDR Technology Select (XLK). For the past twelve months, PLTR has been the top-performing stock of this group, increasing 321.7% which significantly outperformed former leader NVDA with a mere +35.3% gain for the same period.

However, even strong rallies—including those in the tech sector—eventually come to an end. Market rotation occurs when one set of industry leaders gives way to another. This shift in leadership tends to unfold gradually, almost imperceptibly, as institutional investors slowly reduce positions in existing leaders while allocating capital to emerging trends. Investors who aren’t closely monitoring the market often miss these subtle signals that the tide is turning.

The leadership companies of AI appear to have significantly more upside growth for a few more years, along with their stock prices. However, it is ideal to invest in other industries, especially those not associated with AI and tech companies, to diversify the risk of an entire stock portfolio correlating together during a protracted market correction.

This rationale guided our decision to add gold and silver mining stocks to our portfolios earlier this year. Gold has long been considered a hedge against both inflation and U.S. dollar (USD) depreciation. However, gold and other precious metal miners are historically volatile and often experience extended periods of limited price appreciation.

In equity portfolios, exposure to gold and precious metals is typically achieved through Exchange-Traded Funds (ETFs), options, or futures contracts. The challenge with most ETFs is that they generally hold derivatives—such as gold options and futures—rather than physical gold itself. Directly investing in options or futures contracts can also be considerably more complex, volatile, and risky.

We see value in owning established, profitable gold and silver mining companies, offering the dual benefit of potential business growth alongside rising asset values as gold and silver prices increase.

Below is a chart for the past 12 months of the gold miner stocks in our portfolios compared to gold prices adjusted in USD. For the past 12 months, the selected miner stocks have increased from 82.5% to 158% compared to gold prices (gold line), up 36.25% through September 30, 2025. Gold prices rallied in October, adding another 7% but still are trailing the miner stocks.

During most rallies, institutional investors will take profits at various periods to rebalance their portfolios. During strong rallies, stock prices will be retraced to various price support levels, referred to as Fibonacci retracement levels, with typical declines from 20% to 50%. Selloffs greater than 50% are considered a reverse of the positive trend and typically a time to sell and wait for a new uptrend to develop.

You will notice with the chart above that all the gold miners have experienced multiple cycles of Fibonacci retracements during the past year. The recent rally began to slow in early October, and last week the stocks declined, closing below their 50 Day Moving Average. In our view, once the correction stabilizes, it will potentially be a new buying opportunity in miners’ stocks.

What Does This Mean to Me?

The key to consistent long-term portfolio returns is keeping investments aligned with current market trends. Too often, we meet prospective clients whose portfolios still hold positions in once-leading industries that have since fallen behind the broader market—a common reason they seek our guidance. Institutional investors, by contrast, regularly rotate and rebalance their portfolios to capture emerging opportunities and take profits as previous trends lose momentum. The AI and technology boom will likely continue for several more years. However, like all market rallies, this one will eventually lose momentum. The key is to take advantage of the current strong growth trend while staying alert to the early signs that it may be slowing.

Reflecting on the Dot-com bust from 2000 to 2003, many may remember how, in the preceding years, the technology boom of the 1990s seemed unstoppable. However, once investors realized that projected profits were vastly overstated, the selling began. Starting in March 2000, that sell-off intensified into a multi-billion-dollar wave of liquidation. Over the next three years, 1,000’s of tech startup companies with little or no revenue went out of business, while even industry giants such as Microsoft, AOL, Google, Dell, and Intel suffered steep declines in their stock prices. Yet, just as every bull market eventually ends, so too do bear markets—the bottom was finally reached in March 2003, after major indices endured significant losses. Even after three years, the NASDAQ index was still negative with a cumulative return of -34.82%

We maintain our favorable view on the US economy and stock market. We also believe the current AI boom has several years of growth opportunity. However, we also know this trend will slow or reverse at some point. Being aware of market changes as they develop is key to preserving profits and rebalancing into new growth markets.

Let us know your thoughts on this UPdate. We welcome the opportunity to assist you and your family in achieving your financial goals. Give us a call or send an email to schedule a time we can meet.