Cautious Approach Recommended for Precious Metals Investment
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 20 hours ago
0mins
Should l Buy MORN?
Source: CNBC
- Price Volatility: The precious metals market is experiencing a rally in 2026, with gold futures up over 15% year-to-date and silver futures rising 10%, yet both faced severe turbulence on January 30, with gold contracts losing 11% and silver contracts plummeting 31%, indicating significant market instability.
- Portfolio Diversification: Gold is gaining popularity amid geopolitical shocks and inflation fears, with JPMorgan's analysis showing an average four-week return of 1.8% during major shocks, contrasting with a 1.6% average decline for stocks, highlighting gold's effectiveness in diversifying investments.
- Investment Method Selection: Investors can engage in the precious metals market through mining stocks, ETFs holding physical assets, or futures contracts, with each method affecting the risk profile of their portfolio; directly holding physical gold through ETFs is considered the most straightforward investment approach.
- Tax Complexity: The tax treatment of holding a precious metals ETF differs from that of a standard equity ETF, as selling a commodities ETF with physical assets may incur a 28% long-term capital gains tax, and funds holding futures contracts may require K-1 forms, complicating tax filing processes.
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Analyst Views on MORN
Wall Street analysts forecast MORN stock price to rise
2 Analyst Rating
2 Buy
0 Hold
0 Sell
Moderate Buy
Current: 162.750
Low
250.00
Averages
285.00
High
320.00
Current: 162.750
Low
250.00
Averages
285.00
High
320.00
About MORN
Morningstar, Inc. is a provider of independent investment insights in North America, Europe, Australia, and Asia. Its segments include Morningstar Data and Analytics, PitchBook, Morningstar Wealth, Morningstar Credit, and Morningstar Retirement. The Morningstar Data and Analytics segment provides investors comprehensive data, research and insights, and investment analysis to empower investment decision-making. The PitchBook segment provides investors with access to a broad collection of data and research covering the private capital markets. Morningstar Wealth segment brings together its model portfolios and wealth platform; practice and portfolio management software for registered investment advisers; data aggregation and enrichment capabilities; and others. Morningstar Credit segment provides investors with credit ratings, research, data, and credit analytics solutions. The Morningstar Retirement segment offers products designed to help individuals reach their retirement goals.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Price Volatility: The precious metals market is experiencing a rally in 2026, with gold futures up over 15% year-to-date and silver futures rising 10%, yet both faced severe turbulence on January 30, with gold contracts losing 11% and silver contracts plummeting 31%, indicating significant market instability.
- Portfolio Diversification: Gold is gaining popularity amid geopolitical shocks and inflation fears, with JPMorgan's analysis showing an average four-week return of 1.8% during major shocks, contrasting with a 1.6% average decline for stocks, highlighting gold's effectiveness in diversifying investments.
- Investment Method Selection: Investors can engage in the precious metals market through mining stocks, ETFs holding physical assets, or futures contracts, with each method affecting the risk profile of their portfolio; directly holding physical gold through ETFs is considered the most straightforward investment approach.
- Tax Complexity: The tax treatment of holding a precious metals ETF differs from that of a standard equity ETF, as selling a commodities ETF with physical assets may incur a 28% long-term capital gains tax, and funds holding futures contracts may require K-1 forms, complicating tax filing processes.
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- Competitive Pressure: Despite strong demand for Micron's high-bandwidth memory (HBM), significant competition from Samsung and SK Hynix poses a threat, especially with rumors that Micron's HBM4 chips failed to meet Nvidia's requirements, potentially impacting market share.
- Stock Volatility Risk: Micron is viewed as a cyclical stock, with investors concerned that the current memory supply-demand imbalance could quickly evaporate, leading to a sharp decline in share price, which explains its low forward P/E ratio of 11.8.
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