Gold mutual funds may be a golden opportunity to run with the bullion bulls
Filed under: Investing
It appears that swine flu is not the only sickness going around – gold fever is also in the air. Inflation fears and a weak dollar have persuaded investors to move more money into gold, pushing the price of the precious metal above the $1,000 mark. Feverish investors have helped gold to climb to an all-time high of around $1,066 an ounce this week, and analysts are forecasting higher prices next year. Even luxury department store Harrods has gotten into the "cash for gold" business, last week agreeing to accept its exclusive clientele's cash for actual Swiss gold bars. If you can't afford gold bars, one way to get broad exposure to gold is through mutual funds that invest in a basket of companies that are likely to benefit from the current fascination with the precious metal.
Mutual funds capitalize on the results of a number of companies in a sector, spreading investor risk. While those who invested in gold at the start of 2009 have already made a pretty penny, investors are now trying to determine whether a similar golden opportunity will be available in 2010.
Standard & Poor's has forecast a positive outlook for gold and gold mining companies over the next 12 months, meaning their sales and earnings are expected to rise over that period and their stock prices are likely to rise as well.
"Gold prices have broken nicely above key chart resistance just above $1,000 per ounce," said S&P chief technical strategist Mark Arbeter. "If prices break above $1,050 per ounce, we believe it would set the market up for a strong intermediate rally that could take prices up into the $1,200 to $1,500 per ounce range."
This week, gold futures have held above the $1,050 mark, but analysts have cautioned investors not to get too caught up in gold fever. JP Morgan has also forecast gold prices to rise above $1,100 next year, but in a research note earlier this month, the bank's analysts cautioned, "We do remain concerned that gold as an 'inflation trade' is both expensive and premature." Those using gold as a hedge against inflation may want to consider how investing in gold factors into their overall plans if inflation doesn't explode as they fear.
For those who want to invest in gold-based mutual funds, Arbeter recommended the Franklin Gold & Precious Metals fund (FKRCX) as S&P's five-star choice. Arbeter also suggested several S&P four star gold funds, including First Eagle Gold (FEGIX), Tocqueville Gold (TGLDX), Oppenheimer Gold & Special Minerals (OPGSX) and Van Eck International Investors (INIVX).
An additional list of top performing precious metals mutual funds can be found on Yahoo Finance.
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Reader Comments (Page 1 of 1)
10-23-2009 @ 9:52AM
erwin said...
why yu du not have gold price listed on the left side of your site with all the other prices
it is as important as the rest
maybe even more now
erwinessig@aol.com
Reply
10-23-2009 @ 12:13PM
HC Labrock said...
Why is Matthew Scott, the writer of this article, touting Gold now, when it is at it's all time high. Where was this guy when gold was $600/oz. I love these analysts who recommend investments when they are the all time high so they can "short" them.
10-23-2009 @ 1:49PM
USAcitzn said...
If you got money to invest, gold is one way to go ! I wanted to but I had most of my investment locked up in a 7 yr guarantee IRA. Today, another opportunity is participating in The People's Financial Stimulus Plan ... on a private website www . peoplesstimulusplan . weebly . com It's for American citizens and by citizens. To make America strong again, Americans need to be strong financially. By uniting, participants will make it happen !
10-23-2009 @ 3:17PM
dan said...
Alan Greenspan=Bernie Madoff
When those two building came down on Sept. 11 our country suffered an economic melt down on purpose by some terrorists, but it recovered. In Jan of last year we suffered another meltdown even larger, created by Wall Street banks selling unregulated derivatives, and it will take years to get over. Now who are the terrorists now?
The only people who make money off of god are the people who sell it........go to pbs.org, frontline, the program the Warning and get the real dope on the bank scam........
10-23-2009 @ 10:09AM
Tech said...
Kitco.com-best news and info and gold and markets on the net. Gold trades oposite the dying US dollar and so does oil so when oil rises so does gold in the trading game. The dollar has lost 30-40% since they installed that chimp Bush in 2000. America is being downsized and busted in the the global economy in case you haven't noticed or maybe it's because I'm almost 60 and see things from a longer view. Gold and silver have been the best "investment" since 2000 because the country and dollar are being broken. It's David Rockefeller's global economy baloney or haven't you noticed where everything is made now in Walmart? Forget Cramer and the pump and dump lies look at a chart of the dollar, gold, oil, stocks, and think globally now, countries are being taken out like Europe with 27 countries now one under an appointed "president" and run by a few bankers.
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10-23-2009 @ 10:42AM
MSF said...
Looking at Mr. Reid's Goldcorp, one can only believe that Auric Goldfinger would be envious. However, in the strange dealings I've observed in Missouri, and the Fortune Magazine article on "Michael Jackson's Mad Money," and Phil Anschutz. I also went to Denver, to meet Phil Anschutz, and was met by VP, John Spisak. Although, I did meet pregnant Debbie Rowe in 2002, at the Mueller's home. Blanket, would later meet Phil with Michael. Phil, it seems, has met everyone around me. And our deal still hasn't been reached.
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10-23-2009 @ 12:34PM
wayne said...
Gold has made me rich.Right now i,am worth $5 million dollars,last year i was only worth $900,000
Reply
10-23-2009 @ 12:57PM
George said...
Gold doesn't make anyone rich. It preserves wealth. Why does everyone quote how much gold they have using $$$? (ie. $5 million. $900,000). That makes no sense. How many ounces do you own....that's something to brag about. If you have $5 million in an ETF (paper gold) that doesn't mean anything...it might only buy you one ounce of gold tomorrow.
10-23-2009 @ 2:35PM
I have made $32,000,000.00 said...
Nice to see some of us are making $$ in this economy, I've made approx. $32 million in the gold markets in the last year!
10-23-2009 @ 12:51PM
kluji said...
Sell all the gold you can. They are DEAD WRONG and will have you jumping from the frying pan (stocks) to Fire (gold).
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10-23-2009 @ 1:23PM
marshall said...
This would have been a great article about a year ago
Reply
10-23-2009 @ 2:26PM
jeff said...
Watch this before you make nay investments! Watch this Frontline on Hedge Funds and Derivatives and you will call for the disbanding of the FED and the ouster of greenspan. This is an unbiased PBS documentary and shows how the BIG BANKS and HEDGE funds steal our money with no rules or even records of their dealings!! http://www.pbs.org/wgbh/pages/frontline/warning/view/
Pass this on to everyone ... It is the real story!!
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10-23-2009 @ 5:59PM
Ken Stammen said...
Gold (in inflation adjusted Dollars) will not reach an all time high untill it surpasses the 2400.00 per ounce price. In 1980, gold hit 850.00 per ounce. Peter Schiff, founder of EuroPacific Capital, recommended buying gold in 2001. I listened and bought my first 100 Gold Eagles at a price of 305.00 per ounce. I advises everyone I knew to do the same and I got laughed at. WHO'S LAUGHING NOW?
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10-23-2009 @ 3:50PM
Realist said...
Hey -- lets hope the greedy swines get sucked into the gold and silver futures markets and abandon OIL.
Reply
11-02-2009 @ 3:09AM
goldcoinsgain said...
Thanks for the great reading, we buy Gold Bullion in a recession. I will pass this on to our Ira clients to read.
Reply
11-03-2009 @ 7:12AM
gold bullion said...
it is good to save your wealth physically
so gold bullion is the great choice
Thanks for the great reading, we buy gold bullion in a recession. I will pass this on to our ira clients to read
Reply