Market Bets Gold Goes Higher Yet
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According to a report from Bloomberg, analysts have increased forecast for gold more than any other precious metal in the last two months and the experts see the longest rally in a least nine decade continuing through 2011 no matter how the economy reacts.
The report noted that the most widely held gold futures option traded on Wall Street is up to $1,500 an ounce by December, which would be 18 percent higher than the record of $1,266.50 set on June 21. The holdings of gold-backed traded products are already within 0.1 percent of an all-time high at 2,075 metric tons.
Whether the near future holds a rapid economic recovery or a double-dip back into recession, investors should be seen joining the gold market, according to Eugen Weinberg, analyst for Commerzbank AG in Frankfurt.
“A stronger economy would create more jewelry demand. If the economy stays weak or gets worse, then investors will be looking for a safe haven,” Weinberg said.
In 2010, buyers accumulated nearly $10.4 billion in gold across the 10 ETP watched by Bloomberg, amounting to nearly 278 tons of the precious metal.
One of the largest investors in gold has been Soros Fund Management LLC, which sees gold as the "ultimate asset bubble," but added that it makes sense to invest at the start of the bubble, as Soros sees gold continuing to rise. On August 16, Soros had 5.24 million shares of the SPDR Gold Trust, the largest bullion-backed ETP.
Bloomberg noted that the most accurate gold forecaster, Dan Brebner of Deutsche Bank in London, sees gold rising to $1,550 next year.
Gold is up nearly $8 per ounce to $1246 in early action Tuesday.
Ways to Play Gold:
SPDR Gold Shares (NYSE: GLD), Market Vectors Gold Miners ETF (NYSE: GDX), iShares COMEX Gold Trust (NYSE: IAU)
The report noted that the most widely held gold futures option traded on Wall Street is up to $1,500 an ounce by December, which would be 18 percent higher than the record of $1,266.50 set on June 21. The holdings of gold-backed traded products are already within 0.1 percent of an all-time high at 2,075 metric tons.
Whether the near future holds a rapid economic recovery or a double-dip back into recession, investors should be seen joining the gold market, according to Eugen Weinberg, analyst for Commerzbank AG in Frankfurt.
“A stronger economy would create more jewelry demand. If the economy stays weak or gets worse, then investors will be looking for a safe haven,” Weinberg said.
In 2010, buyers accumulated nearly $10.4 billion in gold across the 10 ETP watched by Bloomberg, amounting to nearly 278 tons of the precious metal.
One of the largest investors in gold has been Soros Fund Management LLC, which sees gold as the "ultimate asset bubble," but added that it makes sense to invest at the start of the bubble, as Soros sees gold continuing to rise. On August 16, Soros had 5.24 million shares of the SPDR Gold Trust, the largest bullion-backed ETP.
Bloomberg noted that the most accurate gold forecaster, Dan Brebner of Deutsche Bank in London, sees gold rising to $1,550 next year.
Gold is up nearly $8 per ounce to $1246 in early action Tuesday.
Ways to Play Gold:
SPDR Gold Shares (NYSE: GLD), Market Vectors Gold Miners ETF (NYSE: GDX), iShares COMEX Gold Trust (NYSE: IAU)
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