Precious metals are continuing on their rally. In the long run, gold is definitely going up, but now the price of gold (and silver) has recently been pushed up.
Some say it is because of instability in Ukraine, but honestly Ukraine alone cannot explain the whole thing. The reason why gold is a good investment to consider is that the global economic recovery after the worst financial crisis since World War II seems to be halting. Signs that the economy is not recovering so well are coming from Japan, the US and even China. As a norml consequence people are looking for their favorite good old-fashioned refuge haven: gold and precious metals. And it is not all, in the euphoria of 2013 with a stock rally going up like mad and even strange things such as the bitcoins bubble, people had massively sold gold metal and took money out of their commidity funds and therefore the precious lost much more than it should. Now people are coming back to their senses and we are seeing a normal correction of the price.
When you look at figurers, it is quite clear. Funds in both gold and silver are up 11% this year compared with stocks that return in the returned close to zero in the past two months. The graph taken from a public data from Google Finance shows the striking difference between the returns that you seen in funds that track the gold ($SGOL) and silver ($SLV) prices compared to traditional stock indices Dow Jones and Standard and Poor's S&P500. (you can press on the graph to bereidrect to a site where you can play with the figures).
Some say it is because of instability in Ukraine, but honestly Ukraine alone cannot explain the whole thing. The reason why gold is a good investment to consider is that the global economic recovery after the worst financial crisis since World War II seems to be halting. Signs that the economy is not recovering so well are coming from Japan, the US and even China. As a norml consequence people are looking for their favorite good old-fashioned refuge haven: gold and precious metals. And it is not all, in the euphoria of 2013 with a stock rally going up like mad and even strange things such as the bitcoins bubble, people had massively sold gold metal and took money out of their commidity funds and therefore the precious lost much more than it should. Now people are coming back to their senses and we are seeing a normal correction of the price.
When you look at figurers, it is quite clear. Funds in both gold and silver are up 11% this year compared with stocks that return in the returned close to zero in the past two months. The graph taken from a public data from Google Finance shows the striking difference between the returns that you seen in funds that track the gold ($SGOL) and silver ($SLV) prices compared to traditional stock indices Dow Jones and Standard and Poor's S&P500. (you can press on the graph to bereidrect to a site where you can play with the figures).
So how to benefit from this?
I can recommend two very good Exchange-Traded-Funds (ETFs) which offer exposure to precious metals. They have low management fees compared to other funds, and you can trade them online yourself just like stocks in the stock market, which means extremely low commissions to enter and run the fund. What they do is very simple: they buy precious metal and sell the fund units as shares online, so it is really like you'd buy the precious metal yourself, while doing it easily on the New-York Stock Exchange and of course you do not get the hurdle of transporting/storing the metal yourself, which is also nice! These ETFs are:
I can recommend two very good Exchange-Traded-Funds (ETFs) which offer exposure to precious metals. They have low management fees compared to other funds, and you can trade them online yourself just like stocks in the stock market, which means extremely low commissions to enter and run the fund. What they do is very simple: they buy precious metal and sell the fund units as shares online, so it is really like you'd buy the precious metal yourself, while doing it easily on the New-York Stock Exchange and of course you do not get the hurdle of transporting/storing the metal yourself, which is also nice! These ETFs are:
- iShare's Silver Trust ($SLV). iShare is an ETF-specialised firm set as a spin-off of the famous investment company Blackrock. The management is outstanding, the tools that they are using to run their funds are state-of-the-art and because it is automated, the fund can be managed at a much lower fee than what Blackrock usually charges their clients, which is why it such a bargain for investors,
- ETF Securities Gold Trust ($SGOL). ETF securities is one of the world's leading, independent exchange-traded product providers, and their funds has received the best critics from various independant sites.
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