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Where to buy the Next Dip in Gold
After the violent moves in the gold market last week which took it to another all time high of $1,385, and then a wrenching $25 pull back in a matter of hours, many traders are left grasping for an intelligent way to deal with the barbarous relic. Those who were too clever by half and traded out of the yellow metal early are now trying to buy it back on any dip, driving it relentlessly higher.
The gold bugs who read this letter will not be surprised to hear that the Van Eck International Investor’s Gold Fund (INIVX) has been the top performing US mutual fund for the past five years, with an annual 27% return. The firm focuses on buying miners with good management and decent growth prospects. These are often found listed on the Sarbanes-Oxley free Toronto Stock Exchange. Its three top picks now are Agnico Eagle (AEM), Kinross Gold Corp. (KGC), and Rangold Resources (GOLD).
The gold industry is in a supply/demand sweet spot now, as supplies have been ex-growth for a decade in the face of a rising tide of demand. Peak gold is upon us, and unexploited deposits are getting farther and fewer between. There will be no more of history’s “gold rushes” as seen in California, South Africa, Australia, and Alaska, as the world has been scoured to death for new deposits. This is happening while failed economic policies around the world create ever larger numbers of buyers.
Gold may be overbought for the short term, but the world is waiting to buy it on any $100 dip, where emerging market central banks will be jostling with private institutions and individuals to top up existing positions, and “newbies” fight to open new ones. Van Eck’s conservative one year target is $1,700/ounce. They think the bull market has a good five years to run, and won’t end until we see an inflationary spike, taking prices to who knows where.
To see the data, charts, and graphs that support this research piece, as well as more iconoclastic and out-of-consensus analysis, please visit me at www.madhedgefundtrader.com . There, you will find the conventional wisdom mercilessly flailed and tortured daily, and my last two years of research reports available for free. You can also listen to me on Hedge Fund Radio by clicking on “This Week on Hedge Fund Radio” in the upper right corner of my home page.
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Franklin Gold and Precious Metals (FKRCX) has been slightly outperforming INIVX in the past few weeks, but that's picking nits. I own both; both are excellent choices.
I would not be too quick to say no more “gold rushes”
http://www.theglobeandmail.com/report-on-business/industry-news/energy-a...
Gold fever is gripping Yukon for the first time in more than a century following a discovery by a penniless and persistent prospector that was determined to find the source of the original Klondike deposits.
Shawn Ryan lived in a tin shack for years before uncovering the so-called White Gold district, not far from the fabled Klondike zones. While his work has yet to result in an operating mine, it has already sparked a record-setting staking rush and led to the multimillion-dollar takeover of a junior gold explorer by a senior producer.
Gold? No give me that wonderful Federal Reserve note. I believe in Tax cheat Tim and Obamao. Gold? Can't they just print more?
But you can't eat Federal reserve Notes..
Gold tastes yummy with some ketchup.
Damn. I'm a little tired of not being able to get ASEs for under $20.00. Hey JPM, how about a little short squeeze in silver. I know I don't have enough yet. Get Blythe the Ice Queen off her ass and on her feet. Sheeesh.
It aint dropping 100 points anymore. The shorts are still out there in the Asian and Euro markets, but no dips of late have been sustainable; $25-30 may be the most that can be suppressed from here on in.