Retail sales jumped the past couple of months, but there’s still a lot of uncertainty surrounding the economic fundamentals as the U.S. begins to reopen its doors slowly following the coronavirus pandemic. That uncertainty, of course, will help fuel gold prices in the months forthcoming.
Per a MarketWatch report, “In testimony prepared for the Senate Banking Committee Tuesday, Powell acknowledged that some economic indicators have pointed to a stabilization in activity and other have suggested ‘a modest rebound’ but ‘significant uncertainty remains about the timing and strength of the recovery.’”
“The fact that gold has been unable to break out to the upside despite dollar weakness, ZIRP [zero interest-rate policy]and promises of unlimited liquidity from central banks may be a warning sign for bullish gold investors,” Michael Armbruster, managing partner at Altavest, told MarketWatch. “If gold can’t rally under these conditions, gold bugs should be prepared for the possibility of a shake-out to the downside.”
“We remain bullish gold in the long-run, but we sense short-run risks to the downside,” Armbruster said.
Investors who want to shore up their retirement accounts with gold exposure can look at funds like the popular SPDR Gold Shares (NYSEArca: GLD) and the SPDR Gold MiniShares (NYSEArca: GLDM). Precious metals like gold offer investors an alternative to diversify their holdings, and like other commodities, gold will march to the beat of its own drum compared to the broader market.
In addition to GLD and GLDM, here are a pair of other gold funds to look at:
- iShares Gold Trust (IAU): seeks to reflect generally the performance of the price of gold. The Trust seeks to reflect such performance before payment of the Trust’s expenses and liabilities. The Trust does not engage in any activities designed to obtain a profit from, or to ameliorate losses caused by, changes in the price of gold. The advisor intends to constitute a simple and cost-effective means of making an investment similar to an investment in gold. An investment in physical gold requires expensive and sometimes complicated arrangements in connection with the assay, transportation, warehousing, and insurance of the metal.
- Aberdeen Standard Gold ETF Trust (SGOL): seeks to reflect the performance of the price of gold bullion, less the Trust’s expenses. The Shares are intended to constitute a simple and cost-effective means of making an investment similar to an investment in gold. An investment in physical gold requires expensive and sometimes complicated arrangements in connection with the assay, transportation, warehousing, and insurance of the metal. Although the Shares are not the exact equivalent of an investment in gold, they provide investors with an alternative that allows a level of participation in the gold market through the securities market.
Leveraged funds aren’t an ideal tool for retirees to utilize, but for short-term traders looking for leverage can use funds like the Direxion Daily Gold Miners Bull 3X ETF (NYSEArca: NUGT), VanEck Vectors Gold Miners (NYSEArca: GDX) and the Direxion Daily Jr Gold Miners Bull 3X ETF (NYSEArca: JNUG).
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