Hedging against political cycles is a better investment than AI: Van Eck

A major exchange-traded fund and mutual fund manager finds that winning gold trading isn’t being talked about as much as artificial intelligence trading — but maybe it should be.

VanEck CEO Jan van Eck believes the best investment this year is “hedging against political cycles”. For him, that means investing in gold.

“It’s quietly the best-performing asset this year,” Van Eck told CNBC’s “ETF Edge” at the Future Proof conference in Huntington Beach on Monday.

Gold hit another record high on Friday, its 37th record this year. At the market close on Friday, it was up 28% year-to-date.

Van Eck, whose firm he leads VanEck Gold Miners ETFforeign investment in bullion is expected to continue to boost the commodity. It should also help boost gold mines, which started last year with the commodity. But since Friday, VanEck Gold Miners ETF started to outperform, up 31% this year.

“I think you own both, because if the miners catch up, they’re going to go broke,” he said.

As for AI trading, van Eck says it’s “amazing” how investors refuse to give up on it.

“It’s like part of people’s model portfolios, or core portfolios, is to have this tactical overweight in the semifinals. And some of our biggest customers have actually bought on the decline in the last week or two,” CEO VanEck said.

Last month, his firm launched the VanEck Fabless Semiconductor ETF. It is a companion of his VanEck Semiconductor ETF which excludes companies that run their own foundries such as Intel.

FactSet reports the new ETF’s top holdings as Nvidia, Broadcom and Advanced microdevices from friday.

“Why spend billions of dollars building tokens if you don’t have to?” van Eck said. “Nvidia it doesn’t build its own chips. So this is a different kind of investment strategy.”

Since its launch on August 28, the VanEck Fabless Semiconductor ETF is up half a percent.

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