The three driving forces:
Modern portfolio theory
The sector of companies that extract metals does not move in the same way as the broad stock market (low correlation). As a rational investor, in line with modern portfolio theory (MPT), you can use this diversification opportunity to optimise your portfolio. By combining assets that do not move in the same way, total risk can be reduced without lowering expected return.
Monetary inflation
When the money supply grows faster than the economy, the currency loses purchasing power. This in turn causes real assets to rise in price, as more money competes for the same amount of assets. Metals are real assets with limited supply, and new deposits take a long time to bring into production. Exposure to real assets therefore helps preserve the portfolio's purchasing power in a world of ever-growing money supply.
The unique properties
Metals are elements. Their properties lie in the structure of the atom and can neither be manufactured nor imitated. Electrification, digitalisation and defence rest on exactly these properties. We are now entering a third metal age, in which the world needs more metals than ever.
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