Gold Stocks Still Cheap, But Higher Prices Bring New Risks: Rick Rule

Rick Rule, President and CEO of Rule Investment Media, sees value in gold stocks but warns investors not to buy the sector blindly. Despite a stronger bid returning to the mining sector, gold equities remain cheap compared to the metal.

Rule pointed out that with gold prices moving higher, 'gold companies are selling at the greatest discount to net present value relative to the gold price than they ever have.'

The sector has already seen a significant increase in value, with the world's top 50 mining companies adding an estimated $357 billion in August. However, Rule emphasized that a higher share price is not the same as value.