Is Buying Shares of GLD Same as Owning the Bullion?
The quick answer is: Yes.
GLD tracks the price of Bullion. It is actually the price of 0.1 Ounce of Gold. Slight difference in the price of GLD and Ounce of Gold/10 exists because of 1) market inefficiencies and 2) the Fund might have a slight premium/discount to owning Bullion, due to different risk assessment of any two instruments which are not absolutely Identical. The money you put in buying a share of GLD goes directly into purchasing Bullion Bars. The bars are stored by HSBC in it's vault in London.
Technical jargon aside, for all practical purposes, buying GLD is the same as buying Gold Bullion.
Gold stocks as measured by ASA or the Gold Index are up anotehr 4% today. This is looking more and more like a momentum train, and one's got to be cautious buying now. It could go up more, sure, but chasing fast sectors or stocks generally is a bad idea.
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Sanjay John G.
GLD tracks the price of Bullion. It is actually the price of 0.1 Ounce of Gold. Slight difference in the price of GLD and Ounce of Gold/10 exists because of 1) market inefficiencies and 2) the Fund might have a slight premium/discount to owning Bullion, due to different risk assessment of any two instruments which are not absolutely Identical. The money you put in buying a share of GLD goes directly into purchasing Bullion Bars. The bars are stored by HSBC in it's vault in London.
Technical jargon aside, for all practical purposes, buying GLD is the same as buying Gold Bullion.
Gold stocks as measured by ASA or the Gold Index are up anotehr 4% today. This is looking more and more like a momentum train, and one's got to be cautious buying now. It could go up more, sure, but chasing fast sectors or stocks generally is a bad idea.
Subscribe now to The Wall Street Journal and get up to 8 weeks FREE
Sanjay John G.
1 Comments:
There was an idiot who wrote a piece in outlook money about how Gold was over valued and the only way was down. He said oh Gold might go to 400 but the risk here from 360 is very high and to sell. And they tried to get the people to loan their gold to the banks to get 2% interest on them.
Gee wiz, that didn't work..
Could it be, just could it... That the people are getting smarter?
Those 2 Chileans seem to be the smartest ones I seen for a while. Selling worthless toilet paper to buy something tangible. WOW what a concept.
Dont quit your day job.
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