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A worker wearing heatproof suit pours molten gold from a crucible into a mould in a workshop of Altyntau gold mine extraction factory outside northern Kazakhstan's town of Kokshetau June 13, 2013.

Shamil Zhumatov/Reuters

Globe editors have posted this research report with permission of Jennings Capital Inc. This should not be construed as an endorsement of the report's recommendations. For more on The Globe's disclaimers please read here. The following text is excerpted from the report:

We have examined this gold bear market compared to the previous ones during the past 40 years to have an understanding of how both the commodity and the equities could respond.

The weighted average historical duration of previous gold bear markets was 3.2 years with a weighted average price decline of 43 per cent. This suggests to us that we could be close to the end of the rout though continued price weakness is possible with an implied target gold price of about $1,080/oz (a further 11-per-cent decline).

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We have also examined the widening gap between the commodity and equity valuations which have blown out from its historic trading range due in part to the popularity of ETFs. The Gold/XAU ratio has hit an all-time high and could be due for a correction, in our view, at which point, the trade would be to short gold and long the gold equities.

Read the full report here.

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