Commentaries

Gold Fund Commentary

Gold Fund Commentary

Market Overview

As of September 30, 2025

The gold price continued to set new record nominal highs during third quarter 2025, and ended the period teetering on the precipice of $4,000/oz.

Given a rare convergence of monetary policy uncertainty, attacks on Federal Reserve independence, disruptive trade policy, shifting fiscal policies, heightened local and geopolitical tensions, and high sovereign debt levels, gold continued to be well bid. Its year-to-date gain of just under 50% puts it on an annual pace not seen since 1979. The FTSE Gold Mines Index has been even stronger, which is not surprising given that miners historically have been leveraged to the price of gold; after climbing 50% during the third quarter, the index is up around 135% year to date.1

Gold Price Takes off after a Slow Start to the Quarter

The gold price appeared to consolidate early in the third quarter, trading in a fairly narrow band for the first six weeks or so of the period as investors sought a clear read on the Federal Reserve as it carefully weighed a weakening labor market against inflationary risks. Fed Chair Powell’s August 22 speech at the annual Jackson Hole Economic Symposium appeared to be the dovish signal investors wanted, and the price of gold broke sharply higher as markets began pricing a near-certain September rate cut.

Execution of the Trump agenda, meanwhile, continued to add fuel to the uncertainty fire, heightening the appeal of perceived “safe haven” assets like gold. Trade policy remained unstable during the quarter, with tariffs implemented, delayed, revised and revoked with little warning, deepening the murk around the potential for inflation to reemerge. Meanwhile, the unsystemic implementation of tariffs has caused confusion within the federal body charged with collecting them. To wit, it was widely assumed that gold bullion imported into the US would be exempt from tariffs until a ruling letter from the Customs and Border Protection Agency averred that certain gold bars—including the one-kilo bars that underpin gold futures trading on COMEX in New York—were subject to tariffs: 39% in the case of Switzerland, the world’s largest gold refining hub. Futures contracts in New York spiked relative to the global spot benchmark when the tariffs news came out in early August, only to tumble when an administration official quickly announced that an executive order exempting gold bars from tariffs was forthcoming.2

Meanwhile, Trump continued to press central bankers resistant to his monetary policy point of view, raising concerns about the durability of the Fed’s historical independence. While Chairman Powell continued to bear the brunt of Trump’s attacks—including loose talk about his removal—Lisa Cook, a voting member of the Fed’s board of governors, was a new target during the quarter. Accusing her of mortgage fraud, Trump in late August announced that he had fired her “for cause” after demanding she resign from her position. Cook filed a lawsuit against the president, and the Supreme Court on October 1 prohibited her immediate ouster, though the justices will hear arguments in the case in January.3 Regardless of the outcome, the specter of fiscal dominance is unsettling.

While the abovementioned factors battled for headlines in the financial press, other seemingly intractable factors that have supported gold demand across its current multiyear rally—including massive sovereign debt loads, geopolitical frictions and internal political strife—remained firmly intact. As a result, global central banks have continued to bolster their strategic gold reserves, if at a slower pace than in the previous three years, which saw net purchases in excess of 1,000 tonnes annually. Meanwhile, demand for physically backed gold ETFs—which capture investment demand from both institutional and individual investors—has picked up meaningfully this year, with year-to-date net fund flows of $64 billion equating to more than 600 tonnes of gold.4 Continued demand from these buyers could serve as an ongoing source of support for the gold price.5

Trees Don’t Grow to the Sky

While gold’s rally over the past 18 months has been impressive, we believe a pause is inevitable. In our view, the key risk to the gold rally at this point is the potential for recession. While recessions historically have been positive for the price of gold over the medium- to long-term, the onset of economic contraction can have negative implications.

We saw this during the brief but sharp Covid-19–related recession in 2020 as well as during the 2008–09 recession associated with the global financial crisis. In both instances, however, gold’s value as a potential hedge against adverse events ultimately reasserted itself after an initial period of price weakness.

Independent of fluctuations in economic activity, we believe consistent, strategic gold exposure is critical for diversified portfolios seeking to avoid the permanent impairment of capital and to maximize risk-adjusted returns across cycles.

Portfolio Review

Gold Fund A Shares (without sales charge*) posted a return of 34.28% in third quarter 2025. Gold bullion and gold-related equities both contributed to performance. The Gold Fund underperformed the FTSE Gold Mines Index in the period.

Leading contributors in the First Eagle Gold Fund this quarter included gold bullion, Newmont Corporation, Agnico Eagle Mines Limited, Wheaton Precious Metals Corp and Kinross Gold Corporation.

The factors driving the performance of gold bullion during the quarter were discussed in detail in the Market Overview section of this report.

Newmont is one of the world’s largest gold miners and a major producer of silver. Newmont continued to deliver into both cost and production guidance during the quarter—undiminished by usual seasonality—resulting in record free cash flow generation. As part of its portfolio rationalization plan, Newmont monetized stakes in Greatland Resources and Discovery Silver in June and July, respectively, and sold its stake in Orla Mining in September; proceeds were applied to reducing debt and buying back shares. Meanwhile, investors appeared to take changes to Newmont’s executive suite—including both the unanticipated resignation of its CFO in July and the announcement of long-anticipated succession plans for its CEO—in stride.

Agnico Eagle is a senior Canadian gold producer and one of the largest gold miners in the world. The company reported that production exceeded expectations during the quarter, while strong operations drove record revenues and cash flow. Like Newmont, Agnico sold its position in Orla Mining, which bolstered its already strong balance sheet and underpinned sustained dividend payments and stock buybacks.

Reflecting strong dynamics for gold pricing, all holdings in the portfolio delivered positive returns during the quarter, with the smallest contributions from Pan American Silver Corp. Contingent Value Rights, Orla Mining Ltd., Pan American Silver Corp., Royal Gold Inc and B2Gold Corp.

Pan American Silver is a Canadian mining company with large silver endowments and a diversified portfolio of producing mines. We hold small positions in both its contingent value rights (CVRs) and equity. Price changes in the company’s CVRs reflect expectations of the prospective reopening of the company’s shuttered Escobal silver mine in Guatemala rather than moves in underlying metals prices or its strong business model. Despite prospectively meaningful dialogue between the Indigenous Parliament and Guatemala’s Ministry of Energy and Mines during the quarter, the Escobal mine remains on care and maintenance—pending compliance with Indigenous consultation guidelines—with no target date to resume operations.

Orla Mining is a Canadian junior producer that owns two producing mines (the recently acquired Musselwhite in Canada, and Camino Rojo in Mexico), one feasibility-stage mine (South Railroad in Nevada) and one pre-feasibility project (Cerro Quema in Panama). Before delivering positive returns for the quarter, shares wavered on reduced short-term production guidance and anticipated remediation costs triggered by a one-time pit wall movement at the Camino Rojo mine. Sales of Orla equity by Newmont and Agnico Eagle also weighed on the stock price. Results reported during the quarter were strong, however, bolstered by production from the Musselwhite mine, from which we anticipate substantial, sustained production and cashflows.

Equity in Pan American Silver entered our portfolio through MAG Silver’s partial-stock acquisition of the company in early September. Owning our position for less than one month masked the shares’ strong performance for the full quarter. Pan American provides broad optionality on silver through its mines across the Americas.

We appreciate your confidence and thank you for your support.

Sincerely,
First Eagle Investments

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* Performance for Class A shares without the effect of sales charges and assumes all distributions have been reinvested, and if a sales charge was included values would be lower.

1. Source: Bloomberg, FTSE Russell; data as of September 30, 2025.
2. Source: Reuters, data as of August 8, 2025.
3. Source: Bloomberg; data as of October 1, 2025.
4. Source: World Gold Council; data as of October 3, 2025.
5. Source: World Gold Council; data as of October 7, 2025.
 

 

The performance data quoted herein represents past performance and does not guarantee future results. Market volatility can dramatically impact the fund’s short term performance. Current performance may be lower or higher than figures shown. The investment return and principal value will fluctuate so that an investor’s shares, when redeemed may be worth more or less than their original cost. Past performance data through the most recent month end is available at www.firsteagle.com or by calling 800-334-2143. The average annual returns are historical and reflect changes in share price, reinvested dividends and are net of expenses. “With sales charge” performance for Class A Shares gives effect to the deduction of the maximum sales charge of 3.75% for periods prior to March 1, 2000, and of 5.00% thereafter. The average annual returns for Class C Shares reflect a CDSC (contingent deferred sales charge) of 1.00% in the year-to-date and first year only. Class I Shares require $1MM minimum investment and are offered without sales charge. Class R6 Shares are offered without sales charge. Operating expenses reflect the Fund’s total annual operating expenses for the share class as of the Fund’s most current prospectus, including management fees and other expenses.

1. The annual expense ratio is based on expenses incurred by the fund, as stated in the most recent prospectus.
Investments are not FDIC insured or bank guaranteed and may lose value.

 

Risk Disclosures

All investments involve the risk of loss of principal.
Diversification does not guarantee investment returns and does not eliminate the risk of loss.

Investment in gold and gold-related investments present certain risks, including political and economic risks affecting the price of gold and other precious metals like changes in US or foreign tax, currency or mining laws, increased environmental costs, international monetary and political policies, economic conditions within an individual country, trade imbalances and trade or currency restrictions between countries. The price of gold, in turn, is likely to affect the market prices of securities of companies mining or processing gold and, accordingly, the value of investments in such securities may also be affected. Gold related investments as a group have not performed as well as the stock market in general during periods when the US dollar is strong, inflation is low and general economic conditions are stable. In addition, returns on gold related investments have traditionally been more volatile than investments in broader equity or debt markets. Investment in gold and gold related investments may be speculative and may be subject to greater price volatility than investments in other assets and types of companies. There are risks associated with investing in securities of foreign countries, such as erratic market conditions, economic and political instability and fluctuations in currency exchange rates. These risks may be more pronounced with respect to investments in emerging markets. Strategies whose investments are concentrated in a specific industry or sector may be subject to a higher degree of risk than funds whose investments are diversified and may not be suitable for all investors.

 

Definitions

Federal funds rate is the interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight on an uncollateralized basis. 

Exchange-traded funds (ETFs) are listed investment vehicles that seek to provide exposure to a benchmark, index or actively managed strategy. 

MSCI World Index (Net) measures the performance of large and midcap equities across developed markets countries. A net-return index tracks price changes and reinvestment of distribution income net of withholding taxes.

FTSE Gold Mines Index (Price) measures the performance of gold mining companies worldwide that have a sustainable, attributable gold production of at least 300,000 ounces a year and that derive 51% or more of their revenue from mined gold. A price-return index only measures price changes. 

S&P 500 Index (Gross/Total) measures the performance of 500 of the top companies in the leading industries of the US economy and is widely recognized as a proxy for the US market as a whole. A total-return index tracks price changes and reinvestment of distribution income. 

Nikkei 225 is a price-weighted index composed of 225 stocks in the Prime Market of the Tokyo Stock Exchange. It is widely recognized as a proxy for the Japanese equity market as a whole. 

German DAX® Index measures the performance of the 40 largest companies listed on the Frankfurt Stock Exchange that fulfil certain minimum quality and profitability requirements. It is widely recognized as a proxy for the German equity market as a whole. 

CAC 40® Index is a free-float market capitalization-weighted index that measures the performance of the 40 largest and most actively traded shares listed on Euronext Paris.

Indexes are unmanaged and do not incur management fees or other operating expenses. One cannot invest directly in an index.

The holdings mentioned herein represent the following total assets of the First Eagle Gold Fund as of 30-Sep-2025: gold bullion 18.57%; Newmont Corporation 6.98%; Agnico Eagle Mines Limited 7.33%; Wheaton Precious Metals Corp 10.82%; Kinross Gold Corporation 4.98%; Pan American Silver Corp Contingent Value Rights 2019-22.02.29 0.05%; Orla Mining Ltd 1.44%; Pan American Silver Corp. 3.51%; Royal Gold, Inc. 3.58%; B2Gold Corp. 1.25%.

 

Additional Disclosures

This commentary represents the opinion of the First Eagle Gold Fund portfolio managers as of the date noted and is subject to change based on market and other conditions. The opinions expressed are not necessarily those of the entire firm. These materials are provided for informational purposes only. These opinions are not intended to be a forecast of future events, a guarantee of future results or investment advice. Any statistics contained herein have been obtained from sources believed to be reliable, but the accuracy of this information cannot be guaranteed.

The Fund’s portfolio is actively managed and holdings can change at any time. Current and future portfolio holdings are subject to risk.

The Fund may invest in gold and precious metals through investment in a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands (the “Subsidiary”). Gold Bullion and commodities include the Fund’s investment in the Subsidiary.

The opinions expressed are not necessarily those of the firm. These materials are provided for informational purposes only. These opinions are not intended to be a forecast of future events, a guarantee of future results or investment advice. Any statistics contained herein have been obtained from sources believed to be reliable, but the accuracy of this information cannot be guaranteed. The views expressed herein may change at any time subsequent to the date of issue hereof.

Third-party marks are the property of their respective owners.

FEF Distributors, LLC (“FEFD”) (SIPC), a limited purpose broker-dealer, distributes certain First Eagle products. FEFD does not provide services to any investor but rather provides services to its First Eagle affiliates. As such, when FEFD presents a fund, strategy or other product to a prospective investor, FEFD and its representatives do not determine whether an investment in the fund, strategy or other product is in the best interests of, or is otherwise beneficial or suitable for, the investor. No statement by FEFD should be construed as a recommendation. Investors should exercise their own judgment and/or consult with a financial professional to determine whether it is advisable for the investor to invest in any First Eagle fund, strategy or product.

Investors should consider investment objectives, risks, charges and expenses carefully before investing. The prospectus and summary prospectus contain this and other information about our funds and may be viewed at www.firsteagle.com. You may also request printed copies by calling us at 800-747-2008. Please read our prospectus carefully before investing.

First Eagle Funds are offered by FEF Distributors, LLC, a subsidiary of First Eagle Investment Management, LLC, which provides advisory services.