Spot Gold Breaks Below $4,500, Is It a Buying Opportunity? Huabao Precious Metals ETF Retreats to December Last Year Price, Value Becomes Prominent

Today (March 23), the market is consolidating. Major A-share indices are all pulling back. The comprehensive coverage of leading non-ferrous metal industry ETFs (159876), including gold, rare earths, copper, and aluminum, is also consolidating with the market, sinking below the surface. The intraday price is down 2.91%. Notably, the ETF’s intraday price has fallen back to last December’s level, which may present a buy-the-dip opportunity for funds optimistic about the non-ferrous metals sector.

In terms of constituent stocks, Guocheng Mining rose over 1% against the trend, while the other 59 stocks declined. Chifeng Gold resumed trading and hit the limit down, Shan Jin International dropped over 6%, and stocks like CICC Gold, Zhongkuang Resources, and Shandong Gold fell more than 4%, leading the declines and dragging down the index.

Orient Securities pointed out that recently, the trend of precious metals, especially gold, has been “counterintuitive.” Amid escalating global geopolitical tensions, traditional safe-haven assets like gold have not risen but fallen. This is mainly due to the strong response of the Federal Reserve, which has cooled market expectations for rate cuts, leading to rising U.S. Treasury yields and a stronger dollar index. Additionally, recent liquidity tightening caused by U.S. private equity credit squeezes has made the dollar both a safe haven and a yield asset, diverting safe-haven funds. As a non-yielding asset, gold’s opportunity cost rises with U.S. Treasury yields. Moreover, profit-taking in previous positions triggered technical sell-offs, jointly pressuring gold prices downward, creating an unusual pattern of rising oil prices and falling gold prices.

In the medium to long term, many institutions remain optimistic about gold. Wells Fargo’s year-end target price range is $6,100 to $6,300 per ounce, based on the structural support for gold prices: central banks worldwide have been net buyers of gold for several years, and the long-term credibility of the dollar is still gradually being eroded. Geopolitical risk premiums are only temporarily masked by rate cut narratives and have not truly disappeared.

Currently, gold is in a tug-of-war between short-term and medium-to-long-term logic. In the short term, as long as oil prices do not fall and rate cut expectations do not return, gold prices will face pressure. In the medium to long term, if the Middle East geopolitical situation improves, inflation data trend downward again, or if the Federal Reserve suddenly shifts to dovish signals in any quarter, gold prices could rebound very quickly.

CITIC Securities believes that after the Middle East geopolitical event ends, gold may reach new highs again. Historically, after conflicts in the Middle East, the medium-term trend of gold prices still depends on the credibility of the dollar and liquidity factors. Looking ahead at this round of conflict, the continuation of loose liquidity and weakening dollar credibility is expected to further push up gold prices. Historically, valuation or stock price percentile advantages tend to strengthen the upside potential of the gold sector, and currently, leading companies’ P/E valuations have fallen to a historic low of 15-20x. Considering that recent stock and gold prices have been highly synchronized at their peaks, there is optimism for new highs in gold prices to drive new highs in stock prices.

【The non-ferrous metals boom has arrived; the “super cycle” is unstoppable】

The Huabao Non-Ferrous ETF (159876) and its linked funds (A: 017140, C: 017141) fully cover industries such as copper, aluminum, gold, rare earths, and lithium, including precious metals (hedging), strategic metals (growth), and industrial metals (recovery), spanning different economic cycles. This comprehensive coverage better captures the beta movement of the entire sector. Additionally, this ETF is a margin trading and short-selling target, making it an efficient tool for one-click exposure to the non-ferrous metals sector.

As of the end of February, the Huabao Non-Ferrous ETF (159876) had a scale of 2.427 billion yuan, with an average daily trading volume of over 100 million yuan in the past month. Among the three ETFs tracking the same index, it ranks first in both size and liquidity.

Note: The Huabao Non-Ferrous ETF (159876) was previously known as the Non-Ferrous Leading ETF.

Reminder: Recent market volatility may be significant; short-term gains or losses do not predict future performance. Investors should invest rationally based on their own financial situation and risk tolerance, paying close attention to position sizes and risk management.

ETF fee-related notes: When subscribing or redeeming fund shares, agents may charge a commission of up to 0.5%. Intraday trading fees are subject to the actual charges of securities firms. No sales service fee is charged for ETFs.

Linked fund fee notes: The Huabao CSI Non-Ferrous Metal ETF Initiated Linked Fund (A class) has a subscription fee of 1,000 yuan per transaction for subscriptions of 2 million yuan or more, 0.6% for 1-2 million yuan, and 1% for less than 1 million yuan. Redemption fees are 1.5% if held less than 7 days, and 0% if held 7 days or more; no sales service fee. The C class does not charge a subscription fee; redemption fee is 1.5% if held less than 7 days, 0% otherwise; sales service fee is 0.3%.

Risk warning: The Huabao Non-Ferrous ETF tracks the CSI Non-Ferrous Metals Index, which was launched on December 31, 2013, and published on July 13, 2015. The index’s performance over the past five full years: 2021, +35.89%; 2022, -19.22%; 2023, -10.43%; 2024, +2.96%; 2025, +91.67%. The index’s constituent stocks are adjusted periodically according to the index rules. Past backtested performance does not predict future results. The constituent stocks shown are for display only; stock descriptions are not investment advice and do not reflect holdings or trading activity of any funds managed by the manager. The risk level of this fund, as assessed by the manager, is R3—medium risk, suitable for balanced (C3) and above investors. Suitability opinions are subject to sales institutions. Any information in this article (including stocks, comments, forecasts, charts, indicators, theories, or any other statements) is for reference only. Investors are responsible for their own investment decisions. The views, analysis, and forecasts in this article do not constitute investment advice. The past performance of funds does not guarantee future results, and the performance of other funds managed by the manager does not guarantee the performance of this fund. Investment involves risks; please invest cautiously.