SPDR Gold Trust (ETF)
In a recent interesting article in the Fool’s blog network the author tries to settle which precious metal, gold or silver, is a better investment and serves as a better hedge against inflation. But do these metals serve as a good inflation hedge to begin with? I would like to tackle this issue and examine how well precious metals have protected your portfolio against inflation in recent years; let more »
With the FOMC wrapping up their two day meeting on Wednesday and announcing the future outlook of the quantitative easing program, the idea of inflation is particularly elevated in the minds of investors. A quick glance at the overall inflation numbers might suggest there is little reason to worry, but The adage “a dollar today is worth more than a dollar tomorrow” has been around for decades, and economics teaches more »
It’s no secret the Fed control’s interest rates. While many Americans picture Ben Bernanke in a back room adjusting interest rates with a lever, the system is a bit more complicated. Boiled down, the Fed can either buy or sell government-backed securities to manipulate interest rates. Purchasing infuses the banking system with cash, lowering rates (this is called quantitative easing.)
The Fed artificially lowered rates through continuous purchases more »
For investors interested in precious metals, it really comes down to one decision: silver or gold? Although they frequently trade in tandem, and are often purchased for the same reasons, they are far from identical.
Each metal has its own trade-offs. I'll break down the relative arguments for owning one over the other, and then suggest ways for interested investors to get exposure.
The case for silver
Silver is more »
Those who do not emphasize asset allocation will get burned. Others will earn a fortune. Consider these staggering statistics:
An over-inflated balloon
The American government continues on a massive spending spree. No one can fully predict to what extent the repercussions will affect our economy. However, assets are extremely expensive as the equity market and money supply are becoming increasingly inflated. Simply looking at the S&P 500 (SNPINDEX: ^GSPCmore »)
Gold and silver haven’t performed well in the past several months. Will precious metals recover from their recent tumble? Some people still consider gold an investment worth having. The leading arguments aren’t surprising: Central banks are printing money, global debt is rising and gold has done very well in the past decade. Let’s take a close look at these arguments and consider their validity. Let’s also more »
Gold prices are down about 17% year to date, while the S&P 500 is up about 13%. Before you plunge in to buy on the dip, let's take a closer look at whether (as Bob Barker would say) the price is right.
How can you measure gold's true worth?
In a previous post, I explained how commodities can be difficult to value because of their lack of more »
Platinum and Palladium don't get the same fanfare as oil or gold, but they are important commodities in the modern economy. They are both critical parts of autocatalytic converters and their demand is expected to increase due to growing auto sales. China's recent decision to consider banning dirty coal imports is a sign that the nation is heading down a more environmentally friendly path. This makes it very more »
The world’s leading gold producer Barrick Gold (NYSE: ABX) recently released its quarterly results, in which its profits fell on lower prices and lower volumes. But the company is sticking to its guidance of 7 million to 7.4 million oz. mined for the year. The company's long-suffering shareholders, however, have finally been given some decent news about costs, as the company is going to begin selling off more »
Gold's dramatic rise over the past few years has been made more interesting by its recent fall from grace. Gold currently trades around $1,365 per ounce, down significantly from it's 52-week high of over $1,800. During the time of gold's ascent, many market pundits were advising that miners were a great way for investors to gain exposure to the commodity. They reasoned that the miners more »
Investing in gold was one of the safest things to do under volatile economic conditions. But all that changed when gold took a plunge last month. Now, people are aware that even gold is subject to volatility. It is like the stock market where there are highs and lows; it will not remain bullish all the time.
For the past 10 years, gold was generally upbeat. Those who traded in more »
You don't have to be a doomsday prepper to appreciate gold. There are several good reasons to consider adding the yellow metal to your portfolio including:
- Gold acts as a safe haven in times of (inflationary) uncertainty,
- Gold's low correlation to other assets reduces risk in a long-term portfolio, and
- Gold serves as a hedge against a decline in the U.S. dollar.
Fortunately for investors, the advent more »
I was wrong, I admit it. A while ago I wrote a post about how central bank demand would push gold higher. Instead, lower CPI numbers and other factors have pushed gold prices below $1,400 and caused numerous investment banks to revise their estimates downward. Credit Suisse sees gold heading to $1,100 an ounce by the end of the year, due to decelerating inflation and the global economy more »
Since 2009, most commodities have been on a fairly strong, and sustained, run. But in recent months, that trend has shown signs of reversing. Some prominent fund managers have called for the end of the great commodities “super cycle” -- if that’s truly the case, how should investors position themselves?
The commodities super cycle
Along with equities, commodity prices largely plummeted during the financial crisis, bottoming early in 2009. Then more »
Oh, the lonesome goldbug. Always on the fringes of the financial community but finally vindicated after a 12-year bull run in precious metal prices.
However, today goldbugs are under fire. Gold and silver prices, as measured by the SPDR Gold Trust (NYSEMKT: GLD) and the iShares Silver Trust (NYSEMKT: SLV), are down 25% and 30% year-to-date, respectively.
So what went wrong? Two holes are emerging in the bull thesis.
No more »
The ongoing tumble in the price of gold in recent weeks has dragged along with it gold-related investments, such as gold producers and the SPDR Gold Shares (NYSEMKT: GLD). Will gold rally from its recent decline? Will gold producers’ stocks recover from their downward trend? Let’s examine the recent developments in the gold market to find out.
Is the Demand Going Down?
Despite the recent sharp fall in the more »
Berkshire Hathaway Chairman and CEO Warren Buffett has long been a vocal opponent of gold as an investment. Over the years, the super-investor and one of the richest men on the planet has publicly railed against the merits of the yellow metal. In fact, readers can find a compilation of the Oracle of Omaha's 7 top quotes on gold investing over at Minyanville.com.
The first quote, and possibly more »
Forty-five days after the end of each calendar quarter (which is March 31 for the first quarter), institutional investors are required to file their 13F forms with the Securities and Exchange Commission (SEC). In 13F filings, funds list the value of their equity holdings, as well as the number of shares owned at the end of the quarter. Let's take a look at Chicago-based Botty Investors' latest 13F.
This more »
Gold was one of the top investment choices for the last decade. People who bought gold at the beginning of the decade earned impressive profits. Even though there were downturns in price, most were short term. However, gold has lost its mojo, and is trading almost 20% below its previous high. Gold ETFs, like SPDR Gold (NYSEMKT: GLD), have lost about 15% since January.
Reasons behind the recent gold crush more »
Year-to-date, the price of gold has gone down almost 11%. After hitting a low of $1,352.60 per ounce on April 15, 2013, gold jumped 8.1% last week on strong demand from Asian markets. On the other side, there are also clear cut signals from the futures markets.
In this article I look at the recent happenings in the gold market and whether the current dip in the more »
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