Nov. 18, 2025 6:50 PM ETAppleseed Fund7 FollowersCommentsSummaryWith the gold price touching $4,250/ounce as we write this letter, the end of the beginning of the current gold bull market appears to have arrived.We entered the 2020s expecting gold to outperform all other asset classes (which it has), and we expect that outperformance to continue through the balance of this decade.Foreign central banks have been net buyers of gold ever since, regardless of the price, and they have been net sellers of U.S. Treasuries since 2014.We do not believe that inflation is under control, as most of the long-term drivers of inflation are secular not cyclical and remain in place.Over the 12 months ended 9/30/25, Appleseed Fund Institutional Class has generated an absolute return of 19.14%, outperforming the Morningstar Global Markets Index, which generated a total return of 16.64%.Tashatuvango/iStock via Getty ImagesDear Appleseed Fund Shareholders:“[Gold] could easily go to $5,000, $10,000 in environments like this. This is one of the few times in my life where it’s semi-rational to have some in your portfolio.”─ Jamie Dimon, JPMorgan Chase (JPM) CEO, 10/15/25With the gold price touching $4,250/ounce as we write this letter, the end of the beginning of the current gold bull market appears to have arrived. Better late than never, Jamie Dimon and former PIMCO CEO Mohamed El-Erian are trying to explain why the price of gold has surged 60% year-to-date, with 2025 representing the best calendar-year performance (thus far) for gold since 1979. We began providing Appleseed Fund (APPLX) shareholders with gold exposure starting in 2007, when it was clear to us that a historic housing bust was coming and that a related major financial crisis was looming, requiring a U.S. government bailout financed by newly-printed money. The average closing price for gold that year was $833.60/ounce. Since then, the gold price has risen by almost 6x, with a couple of difficult pullbacks along the way, including an almost 30% decline in the price of gold during 2013, a year when the S&P 500 Index appreciated by more than 30%.In the face of our material precious metals exposure, shareholders are asking us, “Where do you see gold going from here?” In the short term, our honest answer is that we have no idea. If gold can increase in price by 10% over a two-week period, it can also decline in value by 10% over a two-week period; our short-term crystal ball remains cloudy. We would add that gold seems overbought on a short-term basis, which means that it would be unsurprising if gold’s price were to have a correction of some magnitude or consolidate over a multi-month period. However, we entered the 2020s expecting gold to outperform all other asset classes (which it has), and we expect that outperformance to continue through the balance of this decade.And we say that because, in the current environment, we are expecting continued Federal deficit spending largesse, financed by the Federal Reserve’s day-and-night dollar-printing machine, only at a far greater level than what occurred during the Great Financial Crisis (GFC). Besides an unprecedented amount of Federal deficit spending, we have additional reasons to remain long-term bullish on gold, even at $4,250/ounce, despite a few new risks we could not have fathomed back in 2007.Indeed, we believe there are 10 good reasons that cause us to remain bullish on the price of gold, which we share below:Foreign central banks continue to buy gold aggressively. Before the GFC of 2008-2009, foreign central banks as a group were net sellers of gold. U.S. Treasury bonds were considered to be as good as gold or better, and central banks accumulated Treasuries as their primary foreign reserve asset. By 2009, central banks became concerned about the U.S. government’s response to the GFC, after seeing the U.S. government kick the proverbial can down the road by bailing out failing banks and avoiding the difficult decision to restructure the U.S. banking system. Foreign central banks have been net buyers of gold ever since, regardless of the price, and they have been net sellers of U.S. Treasuries since 2014. Then, in 2022, after the United States confiscated Russia’s U.S. Treasury bond holdings in response to Russia’s invasion of Ukraine, foreign central banks accelerated their purchases of gold as a reserve asset. We believe foreign central banks accelerated their gold purchases because they were and continue to be worried about what might happen to their U.S. Treasury bonds should their respective countries anger the United States.Inflation remains persistent and seems to be accelerating. The Consumer Price Index, our best measure of annual inflation despite its many flaws, has remained persistently above the Federal Reserve’s goal of 2% for the last five years, peaking at over 9.1% in June 2022. Moreover, we believe that inflation will likely re-accelerate soon, due to a depreciating dollar, high levels of fiscal deficit spending, significant trade tariffs, and declining interest rates. In environments where inflation is high and accelerating, investors tend to seek out assets that are scarce and liquid, and gold offers investors plenty of both qualities.The relative geopolitical and economic power of the United States is declining. The U.S. dollar became the world’s reserve currency in the aftermath of World War II when the United States stood as the world’s only hegemon, both economically and militarily. Today, the United States’s share of global Gross Domestic Product (GDP) has fallen to just 12.7%, versus 35% in 1944 when Bretton Woods was signed and when most currencies were pegged to the U.S. dollar. In addition, the U.S. military seems to be pulling back from many of its global commitments, while its weapons systems have become increasingly dependent on a supply chain of rare earth metals imported from China, one of its principal adversaries. As the power of the United States has waned while China's has waxed over the past several decades, countries have become more comfortable trading in local currencies without worrying about catastrophic economic or military repercussions.Gold has become more useful as a neutral reserve asset. Historically, international trade commenced largely in U.S. dollars, but today an increasing share of world trade is conducted in local currencies, with any imbalances settled in gold. Because gold is a naturally occurring metal, not a fiat currency whose supply of printed paper is controlled by any single government, it is trusted as a reserve asset by countries everywhere. However, it remains problematic that world trade is so enormous relative to the current value of gold that central banks own. We believe this problem is likely to be solved by central banks buying gold to add to their balance sheets (see Reason #1 above) and by the price of gold rising relative to everything traded between countries, which is exactly what is happening. For example, the gold/oil (ounce-of-gold-to-barrel-of-oil) ratio is currently over 65x, well above the average 15x ratio that existed before central banks resumed buying gold.Gold is severely under-owned by Western investors. Compared to Asian investors, Western investors prefer owning stocks and bonds to gold. Much of this preference results from the stable and positive returns that Western investors have derived from bonds over the past 40 years. Most investment managers as a matter of policy will not recommend a gold allocation to their clients, mostly because nobody else does so and it is professionally risky to stray too far away from the crowd. With gold's price continuing to climb upwards, strategic allocation choices will likely change, but it hasn’t happened yet. Moreover, according to UBS (UBS), U.S. family offices have a strategic asset allocation to commodities of just ~1%. When financial advisors and family offices begin to allocate ~20% of their clients’ portfolios to gold, as Morgan Stanley’s (MS) Chief Investment Officer Mike Wilson just recommended for the first time last month, the demand for gold will necessarily increase markedly, and, with gold’s supply scarcity, we believe the price of gold will necessarily have to increase, too.Physical gold stores in the West are low and declining. Enormous quantities of physical gold have been moving from the West to the East for many years. As a result, gold ounces have been accumulating in China, India, and Russia, while gold inventories have been declining in London and in Switzerland, where institutional bars of gold have historically been refined and stored by Western investors. When physical gold stores become low enough, it is likely that the gold price will be squeezed high enough to persuade long-term holders of physical gold to sell. Such physical shortages have begun surfacing this month among certain retail investors, but not yet among institutional investors.The Debt/GDP ratio worldwide has never been higher. The United States, Europe, Japan, and China have record levels of indebtedness. For the United States, Europe, and Japan, it is a government-debt problem, whereas for China, it is more of a local-government and state-owned-enterprise debt problem. For all these countries, however, their indebtedness problems can be alleviated by depreciating their respective currencies versus gold. This natural alignment enables coordinated policy to support higher gold prices, accelerated inflation, and gradually improving debt ratios. It is likely that the secular top in the gold price will not be achieved until such debt ratios have declined significantly from current levels.Trust is declining rapidly. Trust is rapidly declining between the United States and many other countries, and it is also declining within the United States. This loss of trust extends to many government institutions, including the Federal Reserve, the U.S. institution primarily responsible for regulating the monetary supply and setting interest rates. The gold price tends to rise during periods of declining trust in the Federal Reserve. The Federal Reserve recently announced plans to reduce interest rates further, making the dollar less attractive relative to other currencies and to gold, likely resulting in another round of accelerating inflation that could further erode trust in the Federal Reserve.The Trump administration wants a lower dollar. The United States has a large current account deficit because it imports far more from the rest of the world than it exports. The Trump administration is trying to address this in several ways, including encouraging other countries to allow the dollar to depreciate versus other currencies. Thus far in 2025, the dollar index has declined by about 10%, which means that gold’s performance in dollars has been 10% better year-to-date than gold’s performance in the currencies of other developed countries.Gold remains inexpensive relative to U.S. monetary base. Despite the rising gold price, gold remains quite inexpensive relative to the U.S. monetary supply. At the peak of the last gold bull market, the value of the gold owned by the U.S. government represented more than 120% of the monetary base in 1981, more than triple the long-term average of about 40%. By this measure, gold was clearly in a bubble in 1981, and its price declined significantly over the subsequent two decades. Today, the value of the gold owned by the U.S. government represents just 15% of the U.S. monetary base. Put differently, the price of gold could almost triple from the current price before reaching the historical average of 40%.Having discussed some of the reasons we are bullish on gold, we want to make clear that gold is far from a risk-free investment. We see the primary three risks as being the following:Bitcoin may make gold technologically obsolete. An increasing number of investors are buying bitcoin and other cryptocurrencies as a store of value, considering it “digital gold.” While not tangible, bitcoin is scarce because its supply is algorithmically limited to 21 million (bit)coins, of which the majority have already been mined. Just as most people have opted for email over snail mail due to technological changes, it may be that bitcoin someday replaces gold as the world’s premier store of value.Miners could discover a large new supply of gold. As AI technology advances at an increasingly rapid rate, it could someday become economically feasible to mine asteroids, the moon, or Mars for minerals, resulting in an enormous increase in the supply of gold, somewhat akin to the discovery of gold in the New World during the 16th Century. Such a discovery would result in lower gold prices, all things being equal.Governments could interfere with gold investors’ ability to profit from a rising price. Much like what President Roosevelt did during the Great Depression, the U.S. government could choose to confiscate investor gold. In addition, the U.S. government could apply more punitive capital gains tax rates to investors who sell their gold for a large capital gain.Given the size of Appleseed Fund’s gold positions, we are closely monitoring these and other risks. We view the risks mentioned above as unlikely, but it is nevertheless worthwhile to imagine scenarios that could prevent our clients from profiting from a rising gold price going forward. It may be that we choose to trim some of our gold positions, not because we are so worried about these risks, but to rebalance the portfolio as Appleseed Fund’s gold allocations have increased in light of a ~60% rise in gold prices thus far this year.Performance and Portfolio ChangesOver the 12 months ended 9/30/25, Appleseed Fund Institutional Class has generated an absolute return of 19.14%, outperforming the Morningstar Global Markets Index, which generated a total return of 16.64%. With less than 70% of the Appleseed portfolio invested in stocks, we find the performance to be quite strong on a risk-adjusted basis. Throughout most of the past several years, Appleseed Fund has been positioned for an inflationary, slow growth economy. With inflation levels falling, causing a ripping stock market since the end of 2022, Appleseed’s cautious positioning held back investment returns.The Fund's past performance does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-800-470-1029Appleseed Fund added a number of new names to the portfolio in the past twelve months, including Conagra (CAG), Chemours (CC), Easterly Government Properties (DEA), Diana Shipping (DSX), GXO Logistics (GXO), Lululemon (LULU), Standard Chartered (STAN-GB), Two Harbors (TWO), NICE Ltd. (NICE), and Wal-Mart de Mexico (OTCQX:WMMVY). In terms of portfolio sales, Appleseed Fund liquidated its holdings in SS&C (SSNC), Cameco (CCJ), Wesco (WCC), CNB Financial (CCNE), Sony (SONY), Roche (OTCQX:RHHBY), Estée Lauder (EL), and AGNC (AGNC). All of these securities reached our estimates for intrinsic value, and we took the capital and invested it elsewhere.Within the equity portion of the portfolio, the biggest contributors to the Fund’s performance over the past 12 months were Lumentum Holdings Inc. (LITE) convertible bonds, Fannie Mae (OTCQB:FNMA) preferred equities, AerCap (AER), Cameco (CCJ), and physical gold trusts. The most significant detractors to performance over the past 12 months have been Boardwalk REIT (BEI.UT-CA), Bollore (BOL- FR), Stanley Black & Decker (SWK), Diana Shipping (DSX), and Estée Lauder (EL).In terms of current asset allocation, with regards to equities, we are favoring companies in the consumer staples, healthcare, and agriculture sectors as well as inexpensive, out-of-favor value stocks. Our exposure to companies with larger non-U.S. dollar denominated cash flows has increased materially in the past year. We do not believe that inflation is under control, as most of the long-term drivers of inflation are secular not cyclical and remain in place. The U.S. fiscal situation needs the dollar down and inflation back up to avoid significant fiscal problems in the near-term.Beyond equities, Appleseed Fund is overweight physical gold trusts, Fannie Mae preferred stocks, and physical uranium trusts. We thank Appleseed Fund shareholders for their continued support of us in the management of their investable assets.Sincerely,Adam Strauss, CFAWilliam Pekin, CFAJoseph Plevelich, CFAShaun Roach, CFAJoshua Strauss, CFAAppleseed Fund Portfolio ManagersThis commentary is prepared by Pekin Hardy Strauss, Inc. (dba Pekin Hardy Strauss Wealth Management, “Pekin Hardy”) for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of any security. The information contained herein is neither investment advice nor a legal opinion. The views expressed are those of the authors as of the date of publication of this report, and are subject to change at any time due to changes in market or economic conditions. Although information has been obtained from and is based upon sources Pekin Hardy believes to be reliable, we do not guarantee its accuracy. There are no assurances that any predicted results will actually occur.The S&P 500 Index includes a representative sample of 500 hundred companies in leading industries of the U.S. economy, focusing on the large-cap segment of the market. The Consumer Price Index (CPI) is an unmanaged index representing the rate of the inflation of U.S. consumer prices as determined by the U.S. Department of Labor Statistics.Fund inception date: 12/08/2006The gross expense ratio of the Fund’s investor class, as found in the Fund’s prospectus dated January 28, 2025 is 1.69%, and the institutional class is 1.44%; the net expense ratio after contractual fee waivers through January 31, 2026 is 1.21% and 1.02%. The Fund’s ninety day redemption fee is 2.00%. The Fund's past performance does not guarantee future results. Italics indicate extended performance, as APPIX did not exist until 1/31/11. APPIX extended performance is an estimate based on the performance of APPLX, adjusted for the difference in fees. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-800-470-10291 Year3 Years5 Years10 YearsSince InceptionInvestor Class (APPLX)18.9713.0711.487.506.61Institutional Class (APPJX)19.1413.2511.687.706.83Morningstar Global Markets NR USD16.6422.4913.1811.577.55Morningstar Gbl SMID Cap Index11.8717.5110.999.487.01Top 10 Holdings – as of 09/30/2025Top 10 Holdings – as of 09/30/2025Portfolio Weighting %Sprott Physical Gold Trust (PHYS)8.21AerCap Holdings NV (AER)6.71Lumentum Holdings Inc. 0.500%12/15/20266.23Dollar General Corp (DG)4.78Lululemon Athletica Inc (LULU)3.95Boardwalk Real Estate Investment Trust (BEI.UN:CA)3.67VanEck Merk Gold Trust (OUNZ)3.44CF Industries Holdings Inc (CF)3.15Ituran Location and Control Ltd (ITRN)2.97Sprott Physical Uranium Trust Units (U-U:CA)2.96Holdings are subject to change. Current and future portfolio holdings are subject to risk. Investments in commodities such as gold may be affected by overall market movements, changes in interest rates, and other factors such as embargoes and international economic and political developments. Commodities are assets that have tangible properties, such as oil, metals, and agricultural products. These instruments may subject the Fund to greater volatility than investments in traditional securities. The views and opinions expressed in this material are those of the authors. While we believe we have a reasonable basis for our appraisals and we have confidence in our opinions, actual results may differ materially from those we anticipate. These opinions are current as of the date of this letter but are subject to change. There is no guarantee that any forecasts or opinions in this material will be realized. Information should not be construed as investment advice nor be considered a recommendation to buy, sell, or hold any particular security. You should consider the fund's investment objectives, risks, charges, and expenses carefully before you invest. The Fund’s prospectus contains important information about the Fund’s investment objectives, potential risks, management fees, charges and expenses, and other information and should be read carefully before investing. You may obtain a current copy of the Fund’s prospectus or performance data current to the most recent month by calling 1-800-470-1029. The Morningstar Global Markets Index measures the performance of large-, mid- and small-cap stocks in developed and emerging markets around the world, representing the top 97% of the investable universe by market capitalization. The Index returns do not reflect the deduction of expenses, which have been deducted from the Fund’s returns. The Index returns assume reinvestment of all distributions and does not reflect the deduction of taxes and fees. Individuals cannot invest directly in the Index. However, an individual can invest in exchange traded funds or other investment vehicles that attempt to track the performance of a benchmark index. The Morningstar Global Markets Small/Mid Cap Index measures the performance of global equity markets targeting the top 70% to 97% of stocks by market capitalization in both developed and emerging markets. Distributed by Ultimus Fund Distributors, LLC (Member FINRA).Original PostEditor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.This article was written byAppleseed Fund7 FollowersAppleseed Fund was organized as a non-diversified series of Unified Series Trust with long-term capital appreciation as its investment objective. The Fund’s investment adviser is Pekin Singer Strauss Asset Management, Inc. Note: This account is not managed or monitored by Appleseed Fund, and any messages sent via Seeking Alpha will not receive a response. For inquiries or communication, please use Appleseed Fund's official channels.CommentsRecommended For You