The Dow has been outperforming gold since mid-November. Pension Partners chief investment strategist thinks stocks will have a good 2013, and gold likely underperforms. However, he suspects a short-term correction is likely as gold takes back leadership for a bit.
“Gold tends to outperform stocks during risk-off correction periods, as money on the margin favors less volatile assets during deflation scares,” Gayed writes for MarketWatch. “The trend has unequivocally been down as stocks have performed considerably better than gold, and I suspect that broader trend lower will continue. However, in recent days, gold appears to be stabilizing.”
Full disclosure: Tom Lydon’s clients own GLD.
