U.S. Global Investors (NASDAQ:GROW) CEO Frank Holmes joined Proactive to discuss the company’s data-driven approach behind its Go Gold ETF, now trading on the Colombian Securities Exchange.
Holmes explained that the ETF is built on over ten years of data collection, recalibrated quarterly to focus on gold mining companies with the strongest growth in revenue and cash flow per share.
Proactive: Very welcome back inside our Proactive newsroom. And joining me now is Frank Holmes. He is the CEO of US Global Investors. Frank, good to see you again. How are you?
Frank Holmes: I'm standing with gold. Gold.
Yeah, that’s right. That’s what we’re talking about—your Go Gold ETF, now trading on the Colombian Securities Exchange. Before we get to that news, maybe remind everyone a little bit about this ETF and what you're seeing in the gold market.
It’s a smart beta 2.0. We’ve done over ten years—40 quarters or 120 months—of data collection, looking at the best portfolio construction. We recalibrate every quarter based on gold mining companies’ results and rebalance for those demonstrating the strongest growth in revenue and cash flow per share, or that are traded at the highest free cash flow yield.
We created a thematic gold stock-picking portfolio with a condensed number of names. Royalty companies showed up as having a superior business model. In this ETF, 30% are three royalty names—Franco-Nevada, Wheaton Precious, and Royal Gold. Others like Sandstorm also populate the portfolio. That’s what makes it special and unique.
It has less downside volatility but captures upside gains, making all-time highs as gold prices rise. Being listed in Latin America is important because 30% of the portfolio involves Latin American assets. These companies have royalties in countries like Colombia—Wheaton Precious, for example, has a royalty on the Marmato asset in Colombia, which is controlled by Aris Gold.
I’d imagine that gives people in the region an opportunity to get into the gold market, especially with the Colombian Securities Exchange being well known locally?
Very much so. There's a group called the Andean group, linking Chile, Peru, and Colombia into one super high-tech exchange. They cross-pollinate listings and are also linked with the New York Stock Exchange. If the ETF is already listed in New York, it becomes easier to list there. It makes it easier for local pension funds to buy it and provides a currency hedge, since it’s denominated in U.S. dollars.
And the gold market itself continues to be a bright spot?
Yes. There are many forces—beyond Trump’s tariff war. China is aggressively trying to de-dollarize and is trading with BRICS nations using the yuan. But this hasn’t impacted the dollar as much as it has affected the euro. Middle Eastern oil trades still convert to U.S. dollars for purchases. So, this dollar battle is slowly evolving.
China is the biggest gold producer and buyer. That’s influencing other central banks to buy gold. On the other hand, we’ve seen Modern Monetary Theory being applied by central banks—essentially money printing. This century, gold has been positive 84% of the time. Thought leaders like Ray Dalio are talking about the bond markets crashing, and about buying gold as a hedge. Gold is becoming a more important part of asset allocation.
It’s an alternative asset class. I think its allocation could grow from 10% to 15–20%, though currently only 2% of Americans have exposure to gold or gold stocks. So, there’s a lot of room for growth.
Quotes have been lightly edited for clarity and style