The price of gold, silver, and other metals (precious and non-precious) is roaring into 2026 hot. And it doesn’t appear like the momentum is about to subside, as geopolitical worries and a hard-hit U.S. dollar look to power the real assets to even more strength. Undoubtedly, it’s easy to feel like one is simply chasing momentum by looking to punch a ticket into either the gold miners or physical bullion itself, following one of the best years for gold in many decades.
Of course, gold might have a reputation as a safe asset, but even such a safe haven can take a huge hit to the chin. Looking back, we can see that periods of explosive outperformance in the precious metals have been followed by painful periods of massive underperformance.
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Gold might be overbought, but there may still be room for this bull run
Nobody knows if the latest upside surge is going to end with a steep decline or if the latest pop is the result of a relatively sluggish past decade of performance (at least prior to 2025). In any case, I think investors who have no exposure to gold might wish to gradually dip a toe into the precious metal waters.
If you have the expectation that gold (or silver) will fall after you’ve bought, you’ll allocate your hard-earned dollars accordingly. Perhaps that means buying half of an ounce here with the intention of buying the other half after a 10% correction. In the past quarter, gold has seen a stark pick-up in volatility.
But the dips have been buyable thus far, and though a future correction might lead to a bear market and perhaps even a crash, I still believe investors should play the long game when it comes to gold. At the end of the day, it’s the hedging benefits, rather than the near-term upside potential, that should be at the top of the list of reasons to consider being a net buyer at these levels. At the end of the day, nobody knows if this bull run in gold will span another year, if it’s a multi-year ascent, or if it’ll come crashing down sooner rather than later.
Either way, some pundits believe gold can make a run for US$5,000 per ounce. And other gold bugs might be open to even higher gold, especially if the pace of geopolitical headwinds is maintained through the year. Incremental nibbling on a top-notch gold miner or a physical bullion ETF might be the way to go.
Two ways to bet on gold in 2026
For those seeking greater upside, the miners might be the pick to go with, given that their operating leverage will allow for amplified moves higher if gold continues to appreciate this year. If you’re looking to play it safer, perhaps a gold bullion ETF such as the Sprott Physical Gold Trust (TSX:PHYS) could allow for a better night’s sleep. It’s a closed-ended fund (CEF) that’s worth the price of admission, in my view. Arguably, it’s better to buy the higher-upside miners after a correction has struck.
For now, I view less-volatile bullion and gold ETFs as an interesting place to be. If you’re fine with taking on more choppiness and are pounding the table on gold for 2026, Barrick Mining (TSX:ABX) stands out as a great play as well, with its 1.4% dividend yield.
The miner has serious momentum behind it, but with that comes a greater degree of downside risk. Perhaps nibbling on Barrick and a physical bullion ETF could be the way to go if you’re looking to start a tiny position in the precious metals plays while prices are hovering near highs again. Buying at close to highs doesn’t have to be reckless if you temper your bullishness and are ready to ride out the waves.
