In the past, Buffett, the billionaire chairman of Berkshire, cautioned against investing in the metal because it’s not productive like a farm or a company. Now, gold miners are benefiting from surging bullion prices that are boosting profit margins as costs of production have steadied, making them increasingly attractive investments. Large miners including Barrick and Newmont Corp. have been hoping to woo back generalists who fled the sector years ago.
Paulson & Co., run by billionaire hedge-fund manager John Paulson, also added to its holdings in Barrick.
Buffett might’ve been averse to gold in the past, but he has bet big on metals before. In 1997, he bought 129.7 million ounces of silver, banking on demand exceeding production and re-use. He bought most of it for less than $6 an ounce and sold it soon after, he said nine years later. “I was the silver king there for a while,” he said at the time.
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