A veteran precious metals portfolio manager and a long-time gold analyst have lost their jobs, the latest fallout from the prolonged downturn in the mining sector.
Ani Markova, a fund manager with AGF Investments, and Peter Maletis, a precious metals analyst with Franklin Templeton, were laid off within the past few weeks.
A long-time employee of AGF, Ms. Markova was a vice-president and portfolio manager for the investment firm’s Precious Metals Fund. Mr. Maletis was an analyst who supported Franklin’s Gold and Precious Metals Fund.
They were both let go after years of declining investor interest in the gold and metals sector. Ms. Markova and Mr. Maletis separately declined to comment.
Amanda Marchment, a spokeswoman for AGF, said: “We do not comment on personnel exits.” David Sylvester, a spokesman for Franklin Templeton, said: “While there was a decision to eliminate this particular role and not replace it, the Franklin Equity Group team is well-resourced.”
The industry has had a hard time recovering after the price of gold plunged from US$1,900 an ounce, reached in 2011. Since that time, companies have had to write down assets, slash debt and sell prized assets to improve their balance sheets. It has been difficult for companies to raise capital and keep investors interested in the sector. Many retail investors are pursuing other industries, such as cannabis and technology. Gold is now trading around US$1,310 an ounce.
“The mining sector is a neglected slice of the markets,” said John Ing, president of investment firm Maison Placements Canada, who described Ms. Markova as a mining veteran.
The recent announcements of two mega-mergers among the world’s biggest gold companies, including Barrick Gold Corp. and Randgold Resources Ltd., did little to bring in more retail investors into the sector.
In addition, the wild swings in the stock markets have pushed investors toward government debt, such as U.S. Treasury Bills or T-Bills.
“With the market volatility, everyone has been more cautious. T-bills have more allure than the big mergers,” said Mr. Ing.
AGF’s Precious Metals Fund recorded a negative return on investment of 12 per cent last year and negative 7.7 per cent in the previous year, according to AGF’s website.
Meanwhile, the Franklin Gold and Precious Metals Fund declined 18 per cent last year and 0.1 per cent in the previous year. With the sales charge included, that Franklin fund had a negative return of 23 per cent last year and negative 6 per cent in 2017, according to its website.
At the end of 2011, the year gold prices peaked, Franklin’s precious metal fund had $2.1-billion in net assets, according to Morningstar Inc. At the end of last year, the fund held $794-million in net assets.
AGF’s precious metals fund had $566-million in net assets at the end of 2011, compared with $92-million at the end of last year, according to Morningstar.
AGF and Franklin said they were not unwinding their gold-related funds. AGF said its portfolio manager for Canadian and global resources, Steve Bonnyman, would manage the precious metals fund. Franklin said its fund would continue to be managed by its lead portfolio manager, Steve Land.
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