General Public Feels Bullish On The Gold ETF And Gold Held By The U.S.

“The gold price is comfortably above the $1,000 per ounce level and the SPDR gold ETF (GLD: 109.62 +2.58 +2.41%) is the second most popular ETF in the world behind the SPDR S&P 500 ETF Trust (SPY: 109.74 +1.70 +1.57%). In spite of gold’s increasing popularity as an investment class, there is still significant skepticism amongst most large institutional investors that gold is anything more than the “barbarous relic” that John Maynard Keynes labeled it. The general public, however, apparently feels differently.” Gold Alert reports.

“Parade magazine asked its readers if the United States should sell its gold holdings in order to help contain its budget deficit. With $288 billion in gold at current prices, more than 8,000 metric tons, Parade asked, “Does our country need to keep all of that gold?” Jeremy Siegel, finance professor at the University of Pennsylvania, noted that stocks have outperformed the gold price since the gold window was closed by President Nixon in 1971 and opined that “the gold reserve is a remnant of the monetary system we abandoned.”

“In spite of Professor Siegel’s disparaging comments, a shocking 88% of respondents to Parade’s web poll voted “No” to the question of whether the U.S. should sell its gold. The article did note the minimal impact selling the gold reserve would have on America’s massive $12.3 trillion in debt. While gold has no official standing in today’s international monetary system, the recent purchases by central banks across the globe suggest that, after a long hiatus, gold is becoming relevant again,” Gold Alert reports.

We have listed some options for investing in gold through ETFs below:

LONG:

The investment (GLD) seeks to replicate the performance, net of expenses, of the price of gold bullion. The trust holds gold, and is expected to issue baskets in exchange for deposits of gold, and to distribute gold in connection with redemption of baskets. The gold held by the trust will only be sold on an as-needed basis to pay trust expenses, in the event the trust terminates and liquidates its assets, or as otherwise required by law or regulation.

The investment (GDX) seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the AMEX Gold Miners index. The fund generally normally invests at least 80% of its total assets in commonstocks and American depositary receipts (ADRs) of companies involved in the gold mining industry. The fund is nondiversified.

The Funds (GDXJ) investment objective is to replicate as closely as possible, before fees and expenses, the price and yield performance of the Market Vectors Junior Gold Miners Index (the “Junior Gold Miners Index”). For a further description of the Junior Gold Miners Index, see “Junior Gold Miners Index.”

The objective of (SGOL) the newly listed shares is to reflect the performance of the price of Gold bullion, less the Trust’s operating expenses. The Trust is open ended and is designed for investors who want a cost-effective(1) and convenient(2) way to invest in Gold as well as diversify their Gold holdings.

The investment (UGL) will seek to replicate, net of expenses, twice the performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London. The fund normally invests assets in financial instruments with economic characteristics twice the return of the index. It may employ leveraged investment techniques in seeking its investment objective.

The investment (DGL) seeks to track the price and yield performance, before fees and expenses, of the Deutsche Bank Liquid Commodity Index - Optimum Yield Gold Excess Return. The index is a rules-based index composed of futures contracts on gold and is intended to reflectthe performance of gold.

The investment (DGP) seeks to replicate, net of expenses, twice the daily performance of the Deutsche Bank Liquid Commodity index - Optimum Yield Gold Excess Return. The index is intended to reflect changes in the market value of certain gold futures contracts and is comprised of a single unfunded gold futures contract.

The objective (IAU) of the trust is for the value of its shares to reflect, at any given time, the price of gold owned by the trust at that time, less the trust’s expenses and liabilities. The trust is not actively managed. It receives gold deposited with it in exchange for the creation of baskets of iShares, sells gold as necessary to cover the trust’s liabilities, and delivers gold in exchange for baskets of iShares surrendered to it for redemption. The trust is not an investment company registered under the Investment Company Act of 1940 or a commodity pool for purposes of the Commodity Exchange Act.

SHORT:

The investment (DZZ) seeks to replicate, net of expenses, twice the inverse of the daily performance of the Deutsche Bank Liquid Commodity index - Optimum Yield Gold Excess Return. The index is intended to reflect changes in the market value of certain gold futures contracts and is comprised of a single unfunded gold futures contract.

The investment (GLL) will seek to replicate, net of expenses, twice the inverse daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London. The fund normally invests assets in financial instruments with economic characteristics inverse to the index. It may employ leveraged investment techniques in seeking its investment objective.