“So far this year, the $57 billion GLD has shed more than $15 billion in assets, a full 28% lower than where the fund started the year. The SPDR Gold … dropped 13% in value over the course of Friday and Monday, dropping to its lowest levels since 2011,” reports Chris Dietrich for WSJ.com MoneyBeat.
Still, Brendan Conway at Barron’s points out that Monday’s GLD outflows were “surprisingly small” in light of the metal’s 9% slump.
“Exchange-traded fund investors have a reputation as the ‘fast’ money. But the opposite is true in gold, where analysts use words like ‘sticky’ to describe their behavior,” Conway wrote. “With so many ETF holders standing pat, it sure looks like you can’t blame ETF investors — they were merely along for the ride.”
The bottom line is that Monday’s vicious price decline didn’t cause gold ETF investors to throw in the towel.
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Full disclosure: Tom Lydon’s clients own GLD.