The ongoing market volatility and investor worries are continuing to fan the flames for growth in gold exchange traded funds (ETFs).
But while the demand for gold ETFs is up, demand for gold in terms of tonnage is down 16%, dropping to its lowest quarterly figure in five years, according to the World Gold Council. While instability in equities markets, a weakening dollar and rising inflation have fueled demand for ETFs, volatility in the price of gold has led to the tonnage drop, reports Myra P. Saefong for MarketWatch.
As for the demand in dollars, the overall gold demand climbed 20% for the first quarter, to $20.9 billion, while jewelry demand fell 21% in the developed world. In dollars, the jewelry demand was up 12% to $13.2 billion, and this tends to be the most price-sensitive market. Claymore/ROBB Report Global Luxury (ROB) might ultimately reflect this activity. It’s down 6.5% year-to-date.
Gold ETFs that could feel the effects of the ongoing gold rush:
In other news, the ETF formerly known as streetTracks Gold Shares (GLD) has a new moniker, and luckily it doesn’t want to be addressed as an unpronounceable symbol. Instead, the fund is now known as SPDR Gold Shares (GLD). The name is just part of a re-branding initiative by State Street that was launched in 2007, Business Wire reports.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.