ETF Trends
ETF Trends

Gold ETFs are an interesting contrarian play and could recoup more of the sharp losses they suffered last month with trader sentiment on the precious metal at the lowest level in several years.

SPDR Gold Shares (NYSEArca: GLD) has experienced outflows of more than $7 billion since the end of March. The world’s largest gold ETF is down about 12% for the trailing three months.

GLD has recovered some of the loss it suffered during the violent sell-off in April.

Now, gold traders are the most bearish in three years after investors unloaded a record amount of metal held in bullion-backed ETFs, Bloomberg News reports.

“The investment community or those trading paper gold in futures and ETPs are still heading for the exit,” Ole Hansen, the head of commodity strategy at Saxo Bank A/S, in the article.

However, gold ETFs could bounce more now if the majority of selling is past and bargain hunters step in.

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