Three gold exchange-traded funds to buy as gold prices soar high all have risen strongly in the past year.
Gold prices gained a further boost from the Federal Reserve Board’s Sept. 18 decision to reduce the federal funds rate by 50 basis points, or 0.05%, to a range of 4.75% to 5%. The Sept. 18 rate cut by the Federal Open Market Committee (FOMC) followed 11 straight hikes since March 17, 2022.
Three gold exchange-traded funds (ETFs) stand out as ways to profit from what be the start of a series of Fed rate cuts in the coming months to try to prevent the U.S. economy from slipping into a recession and to guard against increased unemployment. Gold rose to nearly $2,670.90 an ounce on Tuesday, Sept. 24, up 3.26% in the past week alone.
Three Gold Exchange-traded Funds to Buy: SPDR Gold Shares
Mark Skousen, who heads the TNT Trader advisory service and the Forecasts & Strategies investment newsletter, is recommending SPDR Gold Shares (NYSE: GLD). The TNT Trader choice is up 8.31% since it became part of advisory service’s portfolio.
GLD is a “solid way” to be exposed to increases in the price of gold, Skousen wrote to his subscribers. SPDR Gold Shares is the largest physically backed gold ETF in the world.
Ben Franklin scion Mark Skousen, who heads Five Star Trader and Forecasts & Strategies, talks to Paul Dykewicz.
SPDR Gold Shares also is touted as a relatively cost efficient and secure way to access the gold market. Investors in gold ETFs do not need to worry about keeping the precious metal secure the way they do with investing directly with valuable coins.
In terms of performance, SPDR Gold Shares has achieved a total return of 3.68% in the past week, 6.06% in the last month, 14.12% in the past three months, 28.72% so far this year and 37.76% in the past year.
Chart courtesy of www.stockcharts.com
Three Gold Exchange-traded Funds to Buy: iShares Gold Trust
A second gold ETF to buy is iShares Gold Trust (NYSE: IAU), a recommendation of retired pension fund chairman Bob Carlson, who leads the Retirement Watch investment newsletter. Carlson told me he prefers recommending iShares Gold Trust (IAU) rather than other gold ETFs because of its liquidity and low costs.
Bob Carlson, head of Retirement Watch, meets with Paul Dykewicz.
IAU is up 3.67% in the last week, 6.07% for the past month, 14.13% during the last three months, 28.90% so far in 2024 and 37.99% during the last year. Carlson advocates buying the gold fund as a superior investment right now than even money market funds, since the latter’s yield will slip as the Fed cuts interest rates further in the months ahead.
“Yields on money market funds should start to decline soon,” Carlson wrote. “Short-term market interest rates already have declined since the Fed telegraphed its intention to cut rates, and that should feed into money market fund yields as they reinvest proceeds from maturing securities.”
Carlson wrote that he is not inclined to lock in yields with longer-duration vehicles at this point, since he does not “anticipate a steep drop in rates,” he opined. Plus, money market funds give investors the liquidity to seize new investment opportunities as they arise, he added.
Chart courtesy of www.stockcharts.com
Three Gold Exchange-traded Funds to Buy: VanEck Vectors Gold Miners ETF
The VanEck Vectors Gold Miners ETF (NYSE: GDX) gives investors exposure to the companies that bring the precious yellow metal out of the ground. GDX is a current recommendation of Bryan Perry, a seasoned Wall Street investment professional who recommends stocks, funds and options in his Quick Income Trader advisory service.
GDX seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the NYSE Arca Gold Miners Index (GDMNTR), which is intended to track the overall performance of companies involved in the gold mining industry. Gold miners have historically provided leveraged exposure to gold prices.
Bryan Perry leads Cash Machine and Quick Income Trader.
Bryan Perry is the head of the Quick Income Trader advisory service and the Cash Machine newsletter.
GDX is a highly liquid ETF whose portfolio features the largest global gold mining companies. The fund has been surging. GDX is up 4.86% for the past week, 5.36% for the last month, 20.91% for the past three months, 33.54% so far this year and 45.77% for the past year.
Chart courtesy of www.stockcharts.com
The three gold exchange-traded funds to buy as prices of the precious metal soar high all have risen in the past year. Gold prices will gain a further lift from the Fed’s rate cuts, so savvy investors would be wise to profit accordingly.
Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. Follow Paul on Twitter @PaulDykewicz.
