Is passive investing killing the gold sector?

Passive funds have taken over the entire investment universe, not just the metals and mining industry, and this trend of ETFs and quantitative funds has been responsible for the slowdown of financing activity in the junior mining space, this according to Bruno Kaiser, head of Metals and Mining at Desjardins.

“My theory is that the dearth of new issues being done [in the junior mining sector] is because of the growth of passive funds, and that is a phenomenon that has hit the global investment industry, it is not particular to mining,” Kaiser told Kitco News on the sidelines of the Xplor Mining Convention in Montreal.

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