From Morningstar:

Most investors know physical gold is a valuable asset, particularly during economic uncertainty and inflation. Morningstar’s Quantitative Research Team recently released a report analyzing this issue in detail. The team’s conclusions are as follows.
There are four main types of precious metals companies, and they operate mainly in Canada and Australia. These companies are involved in activities like exploration, mining, production, extraction, and refining.
There are challenges in the precious metals mining industry that prevent companies from establishing economic moats. Despite these challenges, the sector has generated exceptional returns in the long run, particularly during bull markets.
Precious metals stocks have a fair level of correlation with other asset classes. They also have a low correlation with fixed income and a negative correlation with the dollar index, offering some respite.
Owning precious metals miners is beneficial but also carries risks. The sector is overexposed to small-cap and highly volatile companies, but liquidity, quality, and yield remain areas of opportunity.
Precious metals companies also have ESG issues, as they tend to have higher risk scores relative to broad equity markets.
Challenges with valuations exist in the precious metals industry. Return on equity and return on invested capital are generally lower than the broader market, and price/earnings ratios seem high.
The challenges with valuations can be attributed to the capital-intensive nature of the mining industry and various risks, such as volatile commodity prices and geopolitical issues.



Read more: Should I Own Precious Metals Stocks in 2024?