Jefferies' Christopher Wood sees gold as the second-best hedge for investors amid rising geopolitical and fiscal risks linked to the Iran conflict, Economic Times Markets reported.

While Wood, Jefferies' global head of equity strategy and author of the weekly GREED & fear newsletter, prefers oil and energy stocks as the primary hedge against these risks, he expects gold and gold mining stocks to benefit from renewed monetary easing expectations, geopolitical shocks, and persistent fiscal concerns. GREED & fear is a closely watched weekly strategy letter, and Wood has been a longstanding advocate of gold in its pages, making the metal a recurring feature of his commentary over the years.

Chris Wood's renewed call to buy gold

Wood's latest view builds on his recommendation from last month, when he said investors should once again begin accumulating gold and gold mining stocks after an extended pause. Gold mining stocks offer equity-market exposure to the metal and are widely treated as a more geared route than bullion itself, since mining costs are comparatively fixed while revenues track the gold price.

Gold outlook

According to Wood, the case for gold and gold miners rests on three drivers: renewed expectations of monetary easing, geopolitical shocks connected to the Iran conflict, and persistent fiscal concerns. Each has an established logic in gold-market analysis: anticipated rate cuts lower the opportunity cost of holding bullion, which pays no yield; armed conflicts have historically driven safe-haven demand for the metal; and persistent fiscal worries — typically expanding deficits and rising government debt — underpin the long-running argument that gold serves as a store of value when confidence in fiat currencies erodes. Even so, he ranks gold only second among available hedges, with oil and energy stocks remaining his preferred primary hedge, consistent with oil's sensitivity to supply risks in the Middle East. Wood details his reasoning each week in GREED & fear, the newsletter in which this latest call appeared.

Source: Economic Times Markets