After a few rough years for gold as investors shifted other asset equities, things are starting to look up, especially for one ETF in particular. MarketsMuse blog update profiles Gartman Gold/Yen ETF (GYEN) as one of the best ETFs to invest in for gold options. This update is courtesy of Zacks’ Equity Research article, “Is This the Safest Gold ETF for 2015?“, with an excerpt below explaining why GYEN could be the best gold ETF.
Gold had one of its worst nightmares in the last two years as investors shifted to more risky asset classes like equities. This is especially true in the backdrop of the strengthening dollar and continued bullishness in the stock market, two conditions that spoilt the safe haven appeal of the yellow metal. The bleeding stretch led the metal to languish below the $1,200 an ounce level – almost near its lowest level since April 2010.
The start to 2015 was no different from the last two years as rising rate worries intensified at the beginning of the year. But the metal started to buck the trend since April. Weakness in the greenback in the wake of soft U.S. GDP in Q1 was the major driving force behind this uptrend.
What Are the Best Gold ETF Bets if Dollar Rises?
In most cases, gold investments are made via the U.S. dollar (which is presently at a roller coaster ride). So, it would be wise to look at the gold ETFs which are not linked to the greenback. Two such lucrative options are Gartman Gold/Yen ETF (GYEN) and Gartman Gold/Euro ETF (GEUR). While GYEN provides positive returns by using the yen for investing its assets in the gold market, GEUR does so with the euro.
Is GYEN the Best Option?
After a nice show in 2013, the Japanese economy has been struggling since the second half of 2014. Japan’s growth in Q1 of 2015 has also been restrained by soft consumption. This ensures that the life of Japanese stimulus will be long as the economy is yet to stand on its own feet.
To continue reading about gold ETF option, GYEN, click here
If this week’s volatility has unnerved you, take a deep breathe, sit back and consider the following assessments courtesy of global macro strategy think tank Rareview Macro and extracts of this a.m. edition of “Sight Beyond Sight.”
Today’s edition is not meant to be read as us preaching a gospel. Instead it is a collection of the thoughts we have gathered through a number of recent meetings/conversations with investors who take plenty of risk, and it has served us well in the past to just write down what people we respect are saying. Therefore, if at times the opinions below come across as too skewed one way or adopt the tone of a “bomb thrower” just take them with a grain of salt.
In the end, our biggest issue is that it is just a matter of a few hours to a couple of days before all investors catch up and put together a similar puzzle.
That is why you should read this entire edition even if it is lengthy and the only morning note you read. Continue reading →
Below extract courtesy of this a.m. edition of Rareview Macro LLC’s daily publication “Sight Beyond Sight”
Editor Note: Performance Speaks Louder Than Words, and the SBS model portfolio as of Aug 15 is a noteworthy +3.72% YTD (and 0.33% WTD) when compared to the universe of macro strategists who, according to news media, have been struggling (whether because of mis-timed moves, over-reaction to events, or completely missing the geo-political mark)
Many in the professional community have rebalanced their long positioning out of Europe or remain short on it against another region. The underbelly of the macro strategy is very weak and many are forgetting that unless the inflation metrics really weaken from here, there are multiple steps that will need to be taken before full-scale European style QE can be introduced. That means part of the recent spread compression, where investors bought on the view QE was imminent, needs to come out of the market. The same can be absolutely argued about Gold, since the backdrop of relative peace and the traditional correlation of the metal to Brent Crude Oil should bring the price down.
Interestingly, this de-escalation of risk is not a result of diplomacy by any party to the Ukraine or Iraq conflicts. Instead, it is the result of ongoing military progress on both regions. Continue reading →
It was in early 1849 that the director of the Mint at Dahlonega, Dr. M. F. Stephenson spoke from the steps of the mint building in a futile attempt to convince the miners to remain in Georgia to mine rather than to flock to California to chase what might be an impossible dream. “There’s gold in them thar hills, boys,” he shouted as he pointed at the hills surrounding Dahlonega.
Below is the lead-in to this morning’s edition of Rareview Macro’s “Sight Beyond Sight”; the ‘read more’ link below provides additional extracts that caught the eye of more than a few folks who follow macro-strategy themes..
Three Day Trickle Down Rule in Play…This is Not Same as Late March Correction
• Conundrum Across Asset Classes Leads to Risk Reduction
• Extra Focus on Front End of Interest Rate Curve and the Left Coast Investor
• Underbelly of Professionals Too Weak…Skepticism Suggest Weakness is Bought
We apologies in advance for the deviation away from our normal humility level but sometimes frustration get the better of us.
The definition of the word Conundrum is: a confusing and difficult problem or question. While just a handful of examples, and because no one has a good explanation, these conundrums are leading professionals to reduce exposure levels for a third day in a row.
Brent Crude Oil is now down for eight straight days (during which it has lost ~5%) and it’s traded down in 12 out of the last 14 days. It is a similar trend in WTI Crude Oil which is down 10 out of the last 12 days. However, contrary to what one would expect Airline stocks are significantly lower in price and the correlation between Gold-to-Oil has not swung back to being negative. In fact, Gold is showing the largest risk-adjusted return and WTI Crude Oil is showing the largest negative risk-adjusted return in Commodities and the rejection so far of the profile (i.e. Gold dropped -10% over 45-days) that followed the peak in the Ukraine-Russia conflict has Gold bears nervous, including us who remain short it via a longer dated option structure.
The darling of Emerging Markets, India SENSEX is -2.5% over the last two days but the Dollar-Rupee (USD/INR) is lower by 41 basis points (i.e. weaker USD and stronger INR). Historically, in bouts of risk reduction both SENSEX and Rupee would weaken in tandem. Continue reading →