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Commodities Briefing - Category | Investment more

Investors are kissing gold goodbye - for now

Posted on 22 July 2016 by VRS  |  Email |Print

Gold prices hit a 3-week low as investors decided to plough into riskier asset classes - like stocks. Basically, investors decided they did not need to hide in safe haven asset classes like gold because data shows that the world’s largest economy, the US, is performing pretty well and the Federal Reserve is literally to hike interest rates again later this year.
At one point on Thursday, gold fell to a low of $1,310.70 a troy ounce, a level not seen since June 24. It has since retraced some of those losses but price gains are still under pressure……………………………………….Full Article: Source

This is Goldman Sachs’ best bet in commodities right now

Posted on 22 July 2016 by VRS  |  Email |Print

While investors have been paying close attention to the gold and oil trade, the best bet right now in the commodity space is selling copper, the head of commodities research at Goldman Sachs said Thursday. That’s because there is a lot of supply coming on, Jeff Currie said.
“We like the idea of the revenge of the low-cost player, meaning Peru. Weakness in demand in China — it’s not in the sweet spot,” he said. “Put it all together, this market’s already in a surplus. Prices at $5,000 a ton — target $4,000.”……………………………………….Full Article: Source

Gold retains status as safest asset

Posted on 20 July 2016 by VRS  |  Email |Print

Since the start of this month and in the aftermath of the Brexit vote, the markets have been largely range bound. The British pound went through a brief renaissance in large part because the Bank of England (BoE) held benchmark interest rates unchanged at 0.50 per cent – the markets had been expecting a cut to 0.25 per cent.
Perhaps more surprising was how strongly the bank’s monetary policy committee voted in favour of keeping rates unchanged (8 to 1). This led to a short-term resurgence in the pound, which moved higher against the greenback before finding stiff resistance just below 1.35. Sterling looks to remain entrenched between 1.30 and 1.35 against the greenback………………………………………..Full Article: Source

Commodities reigniting, but buyer beware

Posted on 19 July 2016 by VRS  |  Email |Print

Global resources fund manager Benoit Gervais is adamant the commodities sector is about to be reignited but advises caution while recovery is nascent. Global Resources Fund, saw performance of the fund rise by 38% during the three months to April. As a result, he can see signs of a recovery in the commodities world but would advise caution for now.
A range of major commodity-linked investment indices have also shown a clear upward trajectory in the past three months, encouraging hopes that what has been long-run bear market has turned a corner………………………………………..Full Article: Source

Silver Institute: Silver Investment Sharply Higher In 2016

Posted on 15 July 2016 by VRS  |  Email |Print

Silver investment has soared in 2016 as investors sought the metal as a safe haven and leveraged exposure to the sharp rally in gold, says the Silver Institute. “Investors actively accumulated silver in the first six months of the year, including both the physical and paper markets,” the organization says.
Exchange-traded-product holdings rose by 44.3 million ounces, or 7.2%, to a record high of 662.2 million.
Investors have also raised their net-long positioning in Comex silver futures and options to a record high of 80,522 contracts as of July 5th, after this was 6,282 contracts at the end of 2015, the Silver Institute says. ……………………………………….Full Article: Source

Metals’ Investors Forget About Brexit: Bull Market Continues

Posted on 15 July 2016 by VRS  |  Email |Print

The U.K.’s decision to leave the E.U. hasn’t really scared investors away from industrial metals. The metal complex continues to rally. As we explained in a webinar yesterday, Brexit had little to no impact on the supply and demand dynamics of industrial metals.
On the demand side of the equation, it is — not the U.K or even Europe — that is the world’s biggest consumer of industrial metals. Supply cuts amid low prices and this year’s boost in Chinese demand for industrial metals, thanks to stimulus measures, continue to be the key factors to watch………………………………………..Full Article: Source

The Difference Between Contango and Backwardation

Posted on 14 July 2016 by VRS  |  Email |Print

For equity investors, these terms may sound made up, but they’re required knowledge for commodity investors. Futures trade on curves, so knowing the direction and slope of a curve is a must in order to invest in commodities and be successful.
They are used to track individual commodities, such as oil or gold, and can be plotted on a chart to show the shape of the curve. A standard futures curve will slope up showing the rising price in the commodity over time, while an inverted curve will show the opposite effect………………………………………..Full Article: Source

Why investors should expect the gold price to continue to rise

Posted on 13 July 2016 by VRS  |  Email |Print

Despite the move towards more ‘risk-on’ assets in recent days, investors should continue to expect the gold price to rise, according to Nitesh Shah, commodity strategist at ETF Securities.
Positive economic data from the US, coupled with the view that the Bank of England will boost stock markets, and maybe economic growth with an interest rate cut and perhaps more quantitative easing, has pushed many investors back into equities, with the US S&P 500 hitting an all time high, and the UK FTSE 100 advancing significantly from the lows achieved immediately after the EU referendum result………………………………………..Full Article: Source

How to make money in this lousy market

Posted on 11 July 2016 by VRS  |  Email |Print

Being an investor is tricky these days. There’s broad agreement that the stock market is pricey, the economic recovery is long in the tooth and central banks really can’t do much more to prop up growth.
Hardly anyone is predicting market Armageddon, but this is not the “get rich quick” era. The word on Wall Street is: Prepare for lousy stock and bond returns for years. That doesn’t mean you’ll lose money, but don’t expect to rake in the usual 7% to 8% return on stocks and 3.6% on bonds, according to investment firm Bernstein. Even private equity returns aren’t what they used to be………………………………………..Full Article: Source

What’s Pushing Chinese Investors Into Commodities? (Video)

Posted on 11 July 2016 by VRS  |  Email |Print

Trading volumes for commodities cratered after Chinese regulators took steps in April to deflate a bubble. But speculators aren’t done yet. Bloomberg’s Alexander Kwiatkowski reports on “Trending Business.”.………………………………………Full Article: Source

Japanese Buying Physical Gold, Storing it in Switzerland

Posted on 11 July 2016 by VRS  |  Email |Print

Japanese investors are buying Bullion and storing it in Switzerland because of negative interest rates and fears JPY will depreciate as the government grapples with the heaviest public debt burden in the developed world, according reports.
The number of buyers jumped 62% in 1-H of Y 2016 Vs 2-H of Y 2015 the data show. The Bank of Japan (BOJ) has embarked on unprecedented bond buying to bolster the economy, prompting speculation that JPY could plunge if stimulus efforts fail………………………………………..Full Article: Source

Perils of investing in commodities like gold & oil

Posted on 07 July 2016 by VRS  |  Email |Print

In order to help investors become better at navigating the stock market, Jim Cramer revealed some of the biggest mistakes he has made in over 30 years of investing. “Frankly, there are so many mistakes here that it might take a bit to explain them all,” the “Mad Money” host said.
He learned that when it comes to investing in commodity stocks, investors must know that it doesn’t matter which ones they pick — like going for a better balance sheet or higher growth — if the underlying commodity is hit. If that happens, they will all go lower………………………………………..Full Article: Source

Investors Expand Their Appetite for Commodities

Posted on 06 July 2016 by VRS  |  Email |Print

Desire for commodities-based funds is expanding beyond just oil and gold. In recent months, investors also have developed a healthy appetite for funds focused on agricultural products and industrial materials. Indeed, the entire commodities complex has become a magnet for fund investors’ money, according to new research.
In the first four months of this year, investors poured $38 billion into commodities exchange-traded funds and other commodities investment funds globally, according to a recent report from Barclays. That compares with annual outflows of as much as $83.2 billion in each of the prior three years, through 2015………………………………………..Full Article: Source

CITI: Oil is a better safe-haven option than gold

Posted on 06 July 2016 by VRS  |  Email |Print

One of the more popular debates among economists revolves around this question: What’s the point of gold? Some think it doesn’t serve any purpose, and therefore has no intrinsic value. Others claim that hoarding gold is a legitimate way to safely store wealth in preparation for economic troubles.
As such, a Citi research team led by Jonathan Stubbs argued that, overall, black gold — aka oil — is probably a better bet than gold. “Many investors see gold as the ultimate hedge. We see a strong case for owning ‘black gold’ over gold for those truly looking for a two-way, rather than one-way, hedge against real world risks,” the team recently wrote in a note to clients………………………………………..Full Article: Source

Investors hold the gold as risk-appetite goes cold

Posted on 05 July 2016 by VRS  |  Email |Print

The amount of cash invested in gold funds has jumped by one-third since the beginning of the year, as investors become more and more desperate to squirrel their money away in safe havens.
Data from Bloomberg showed holdings in bullion-backed exchange-traded funds (ETFs) swelled to 1,959 tonnes at the end of June, up from 1,458 at the beginning of the year, with a flurry of new investments off the back of the UK’s decision to leave the EU………………………………………..Full Article: Source

Precious metals: Safe haven in unstable times

Posted on 01 July 2016 by VRS  |  Email |Print

Economic upheaval. Monetary shenanigans. Cashless society and computer hackers. The reasons to own physical precious metals are legion, in light of the truism that governments and their paper currencies rise and fall, but gold always has intrinsic and universal value.
Individuals have long chosen to own gold coins and other precious metals because it serves as a storehouse of wealth and a solid, tangible investment………………………………………..Full Article: Source

Faber Says Own Gold, Prepare for QE4 as Easing Follows Brexit

Posted on 30 June 2016 by VRS  |  Email |Print

Gold’s investment case has been strengthened by the U.K.’s vote to quit the European Union as the fallout may spur the world’s central banks to step up easing, hurting currencies and favoring bullion, according to Marc Faber, publisher of the Gloom, Boom & Doom Report.
The U.S. Federal Reserve may even embark on a fourth round of quantitative easing, or QE4, Faber said in an interview on Bloomberg Television on Wednesday, adding that he typically buys bullion every month. While he also likes gold shares, they need to correct first after recent gains, he said……………………………………….Full Article: Source

Gold’s upside from here is limited, says Goldman’s Currie

Posted on 28 June 2016 by VRS  |  Email |Print

Investors are flocking to gold as a safe haven trade after the U.K.’s vote to leave the European Union, but the upside from here is rather limited, the global head of commodities research at Goldman Sachs said. “One of the key reasons for that is the market is incredibly long. We’ve also seen a sharp decline in interest rates, particularly U.S. Treasurys, which suggests that we probably are topping out here,” Jeffrey Currie said.
Goldman Sachs upped its gold price forecast to $1,300 on Friday after Thursday’s Brexit vote sent the price soaring. The precious metal was trading around $1,330 in afternoon trading Monday………………………………………..Full Article: Source

Investors pouring billions into passively managed funds

Posted on 28 June 2016 by VRS  |  Email |Print

Cheap, flexible and tax-efficient. The three big advantages of passively managed exchange-traded funds continue to drive the migration of investment assets from actively managed mutual funds to ETFs.
Many industry observers expected that increased market volatility would push investors back to active managers, but the latest asset-flow stats from research firm Morningstar suggest not. In May, $18.7 billion flowed out of actively managed U.S. equity funds and $8.1 billion flowed into passively managed ones that track an index — largely ETFs………………………………………..Full Article: Source

Hedge Funds Win World-Beating Rally With Record Gold Holdings

Posted on 27 June 2016 by VRS  |  Email |Print

Unlike most of the world, gold investors got it right when it came time to betting on the Brexit vote. They were rewarded with a world-beating rally. Hedge funds boosted their bets on price gains for bullion to an all-time high just two days before U.K. voters took to the polls and decided to leave the European Union, sending global markets roiling.
Gold futures climbed to a two-year high after the referendum. The metal’s wild ride isn’t over yet. Prices could jump another 7.7 percent by the end of the year, a Bloomberg survey showed………………………………………..Full Article: Source

Why Aluminum Is A Suitable Commodity For Long-Term Investors

Posted on 27 June 2016 by VRS  |  Email |Print

The development of the global automotive industry has a positive impact on aluminum prices. The current perspectives of the global automotive industry assume a significant growth in aluminum demand in the mid-term. The decline in aluminum production and its warehouse levels are positive catalysts for the growth of aluminum prices.
One of the features of the aluminum market is that the biggest share of aluminum imports belongs to the United States: it amounted to 10.8% of total imports in 2015. The reason is that aluminum is mainly used in the construction and automotive industries, and their activities are spread all over the world………………………………………..Full Article: Source

Investors Map Post-Brexit Strategies Amid Global Market Upheaval

Posted on 27 June 2016 by VRS  |  Email |Print

Britain’s vote to leave the European Union almost a quarter century after its creation with the Maastricht Treaty left global markets in disarray Friday. Today, investors start to figure out the way forward.
“Ultimately, we have no experience in what will happen next,” Glen Capelo, managing director at Mischler Financial Group Inc., who has spent the intervening years on various trading desks, said in a note to clients. “Twenty-three years of positions may now need to be unwound,” he added in an e-mail………………………………………..Full Article: Source

Commodities Players Are Set Up for Market-Crushing Gains

Posted on 24 June 2016 by VRS  |  Email |Print

The resource sector’s devastating five-year bear market saw the Bloomberg Commodity Index drop 60% from its 2011 peak. Naturally, that crushed the world’s dominant resource producers; the top 40 companies saw their market caps shrink by $27 billion in 2015 alone.
All along, these producers have had to clean house, slash spending, reduce headcount, and rationalize every last cent they did spend as production crashed. It was the law of the jungle in action, survival of the fittest. Plenty of producers went straight out of business. It wasn’t easy to watch, and it was even tougher to invest in………………………………………..Full Article: Source

Wells Fargo Thinks Commodities are Still a Good Catch

Posted on 23 June 2016 by VRS  |  Email |Print

The big run by commodities is lifting prices for major benchmarks to new highs in 2016. But advisors who are wary at this point of putting new clients’ money into funds – either broad-based or more focused on futures like gold and oil – might find reason for relief by taking a longer-term view of such historically volatile markets.
“Advisors who are working with clients on a more strategic basis should be able to allocate to commodities with more confidence now,” says John LaForge, head of real asset strategy at Wells Fargo’s Investment Institute………………………………………..Full Article: Source

Is silver next for Chinese speculative investors?

Posted on 22 June 2016 by VRS  |  Email |Print

The roulette game all started in the fall of 2014, about two years after Chairman Xi Jinping came to power and became the general secretary of the Communist Party of China. Xi Jinping had campaigned for socialist economic reform, including a sweeping anti-corruption drive, cutting excess production capacity, tightening of housing credit, and clamping down on gaming in Macau.
Public feedback was initially positive. However, largely as a result of those policies, Beijing was facing an increasingly grim economic growth outlook which was the worst in more than two decades*. Manufacturing activity in China slowed along with the global economy and the construction sector stagnated………………………………………..Full Article: Source

Uncertainties of Brexit making gold attractive as safe asset

Posted on 20 June 2016 by VRS  |  Email |Print

The outcome of Thursday’s Brexit referendum will chart the price of gold in the next six to 12 months, but, in the longer term, investors and analysts agree that bullion is an asset to hold. The immediate trigger for any gold price moves will come in the wake of the referendum, which could see Britain leave the European Union.
Robin Tsui, exchange traded fund (ETF) gold specialist of Asia-Pacific at State Street Global Advisors, said: “If Britain does decide to vote for an exit, this would trigger more uncertainties. There are also risks that other countries may follow Britain to vote for an exit………………………………………..Full Article: Source

AfDB to invest $24b in agriculture

Posted on 20 June 2016 by VRS  |  Email |Print

African Development Bank(AfDB) President, DrAkinwumiAdesina said the bank plans to invest about $24 billion (or $2.4 billion yearly) over the next 10 years to help drive the agricultural transformation inAfrica.
This is, he said, represents a 400 per cent increase in financing to the agricultural sector by the bank. He spoke at the Seventh African Agricultural Science Week and FARA General Assembly, in Kigali, Rwanda. He lamented that Africa spends $35 billion on importing food. This, according to him, is projected to grow to $110 billion by 2025………………………………………..Full Article: Source

These two commodities will get a boost from Brexit

Posted on 17 June 2016 by VRS  |  Email |Print

Most investors anticipate a global selloff and flight to safety in the event of a British exit from the European Union, but two commodities are expected to rally. The cocoa and U.K. natural-gas markets are two of the last remaining commodities contracts still denominated in sterling. Most commodities, from oil to copper to gold, are priced in dollars.
If Britain votes to leave the EU, the pound is expected to plummet, boosting these commodities by making them cheaper in other currencies. A vote to exit the EU would cause a sharp rally in the London-traded cocoa contract, said Max Goettler, a trader at Cocoanect in Rotterdam………………………………………..Full Article: Source

Commodities making a comeback as best performing asset class

Posted on 16 June 2016 by VRS  |  Email |Print

Commodities have performed strongly so far this year, returning 14.0%, outperforming Bonds at 6.6% and Equities at 0.5%. Nitesh Shah, Director – Commodities Strategist, ETF Securities, identifies an improved outlook for global growth, and signs of a commodity supply deficit, as key stimulants of the comeback.
“Sustained central bank interest in keeping interest rates low in an effort to stimulate the economy is providing further support for commodities. And investor sentiment has come off near decade lows as investor realise that commodity oversupply is ending in many areas.”……………………………………….Full Article: Source

China’s Investors Shifting to Global Commodities

Posted on 16 June 2016 by VRS  |  Email |Print

China’s cash-rich investors are increasingly looking to trade on offshore commodities markets after a regulatory crackdown and amid fears over the depreciation of the yuan, according to Marex Spectron Group.
“We’re definitely seeing a tumultuous rise in retail-type or investor-type trading,” Simon van den Born, the broker’s global head of metals, said Wednesday at a press briefing in Hong Kong. Revenues from China have doubled this year, offsetting a slump of about 30 percent in traditional business from industrial and corporate clients, he said………………………………………..Full Article: Source

Multi-asset managers turn to passives for commodity exposure

Posted on 16 June 2016 by VRS  |  Email |Print

Multi-managers hoping to take advantage of the recent commodities bull run and rebuild their exposure have been forced to allocate to passive vehicles, as many active equity fund managers are holding “material underweights” to the unloved energy and mining sectors.
The Bloomberg Commodity index, which tracks returns from 22 raw materials, recorded a 21% gain over the six months since the lows of January, when concerns about China’s slowdown weighed heavily on the sector. There have been gains across the board as supply constraints and production cuts have driven up prices………………………………………..Full Article: Source

European investors buy heavily into gold ahead of Brexit poll

Posted on 16 June 2016 by VRS  |  Email |Print

Gold prices are spiraling with a rise in uncertainty in the developed world. In America, the ongoing meeting of the Federal Reserve is expected to decide on whether to raise policy rates. And, there is the June 23 referendum in Britain on whether to leave the European Union (’Brexit’).
If rate increase in the US and Brexit does happen, European investors will look for hedging in a safe haven, gold at present. SPDR, the largest exchange traded fund for gold, has seen its holdings rise nearly 40 per cent since January and 9.7 per cent since April. Since the beginning of May, its gold holdings have risen on a net basis by 94 tonnes, indicating investor buying. For, recessionary conditions will accelerate in Britain if it chooses to opt out of the EU, which is positive for gold………………………………………..Full Article: Source

Should investors be seeking safety in gold?

Posted on 16 June 2016 by VRS  |  Email |Print

Global gold investment shot up to the equivalent of 617.6 tonnes in Q1 this year, the second highest quarter on record, according to figures from the Global Gold Council and equivalent to $27.2bn (£18.8bn) based on prices of $1,250 an ounce. The industry body attributed the upsurge in demand to negative interest rates, stock market volatility and concerns about global growth.
ETFs were the “main engine” of this growth, according to the organisation, seeing inflows of 363.7 tonnes following three years of almost uninterrupted outflows. At BlackRock, one of the largest ETF providers, gold-based ETPs saw $4.1bn (£2.8bn) of inflows in May, second only to bond funds for net flows at the asset manager, while its gold miners ETFs saw inflows of $1.3bn………………………………………..Full Article: Source

Is Gold-to-Silver Ratio Too High?

Posted on 15 June 2016 by VRS  |  Email |Print

The gold-to-silver-ratio is an indicator that shows how many silver ounces are required to purchase an ounce of gold. The gold-to-silver ratio is one of the most important parameters in the precious metals market, as it measures the relative value of gold and silver. Therefore, it is a useful tool indicating whether gold or silver is undervalued or overvalued relative to each other.
Investors can use the ratio as a timing indicator deciding when to buy gold or silver, or which metal to buy at any given time. When the ratio is low, it means that silver is overvalued relative to gold (and vice versa)………………………………………..Full Article: Source

Should Investors Buy Into Alternative Assets Like Hedge Funds?

Posted on 15 June 2016 by VRS  |  Email |Print

Hedge funds and the less-pricey liquid alternative funds that attempt to mimic them have generally underperformed thus far in 2016. Walter Davis, alternative investments strategist at Invesco (IVZ) , said they started off well when the market dropped to start the year, yet have foundered since stocks turned up in mid-February.
“It’s been a tough environment because there has been volatility and a lack of sustained moves in the market,” said Davis. “It’s just been chopping around.”……………………………………….Full Article: Source

Bullish gold and agricultural bets rise as oil wavers

Posted on 14 June 2016 by VRS  |  Email |Print

Investors’ appetite for gold and agricultural commodities helped lift overall bets on rising commodity prices by 20 per cent last week even as speculators soured their expectations for an oil price that has almost rebounded since January.
“Aggressive buying of natural gas, gold, corn, wheat, and sugar more than offset the fact that the number of commodities being sold outnumbered those being bought,” said Ole Hansen, head of commodity strategy at Saxo Bank………………………………………..Full Article: Source

Investors pile into quant funds

Posted on 13 June 2016 by VRS  |  Email |Print

Investors may be fleeing hedge funds in droves but they are still allocating money to technology-driven strategies, despite more than a year of lacklustre performance. The move suggests investors are looking to position themselves for increased market swings or a possible crash as “quants”, which use computer algorithms to predict market moves, are not correlated to other strategies.
The number of institutional investors who allocated funds to the most popular sub-strategy of quant known as commodity-trading advisers, or CTAs, hit a record of 1,067 in 2015, an addition of 50 from the previous year, according to the data provider Preqin………………………………………..Full Article: Source

Billionaire Investors Back A Gold Price Rally In 2016

Posted on 10 June 2016 by VRS  |  Email |Print

It wasn’t so long ago that some of the more famous investor gurus were shrugging off gold as nothing more than shiny trinkets with no investment value. They were wrong. This safe haven is back, the recovery is clear, and there have been some very big changes of heart.
The biggest gold producers in the world have seen their share prices double this year. Not only are gold prices soaring, but producers are cutting costs and slimming down debt as they pave the way for gold to return to the top of the favored commodities list………………………………………..Full Article: Source

The Big Bet of 2016: Joining George Soros in Gold

Posted on 10 June 2016 by VRS  |  Email |Print

Investors pile into the metal, up 20% this year, and mining stocks, which have vaulted even more. There is a new gold rush on. Abating expectations for Federal Reserve rate increases have fueled a fresh boom in everything that glitters, from gold futures to the shares of gold-mining firms to exchange-traded funds that give traders a way to bet on gold’s daily rise and fall.
Front-month Comex gold futures have been among the best-performing major asset classes in financial markets this year, up about 20% as of Thursday………………………………………..Full Article: Source

How Are Gold Miners Placed in a Volatile Gold Price Environment?

Posted on 09 June 2016 by VRS  |  Email |Print

Gold investors became worried after the release of the Federal Reserve’s April minutes, which were more hawkish than expected. This put the summer rate hike back on the table, causing gold to lose some of its sheen. Gold lost 5.1% in 11 trading sessions after the minutes were released.
The Market was also awaiting the May jobs data to get a sense of the direction of Fed’s monetary policy. The data came in markedly below expectations, lowering the chances of a Fed rate hike in June………………………………………..Full Article: Source

Commodities making a comeback, but investors remain wary

Posted on 08 June 2016 by VRS  |  Email |Print

After years of disappointing returns, commodities have now entered into a bull market and become the best-performing asset class this year. Prices are expected to stay high in the second half of the year with tightening physical and supply fundamentals across the complex, said analysts.
Yet, many investors remain wary of investing in the asset class and are still underweight on commodities, said a fund manager. The strong performance of commodities, fuelled by higher crude oil and gold prices, has outpaced those of equities and bonds………………………………………..Full Article: Source

Rebound in distressed debt boosts investors

Posted on 06 June 2016 by VRS  |  Email |Print

Robust gains mainly reflects valuations for energy bonds rebounding with a higher oil price. Distressed debt investors have experienced their best returns since the financial crisis, providing a rare boost for specialist players after disappointing results in recent years.
In the wake of two straight years of 20 per cent plus losses, this highly volatile style of investing has rebounded strongly, with gains between March and May approaching 30 per cent, the best three-month stretch since the US emerged from recession in July 2009………………………………………..Full Article: Source

Investor Interest in Gold Waning With Fed Rate Increase Looming

Posted on 03 June 2016 by VRS  |  Email |Print

There’s one more indicator signaling investors are beginning to lose interest in gold again. Open interest, a tally of outstanding contracts in futures on the Comex in New York, fell 1.5 percent on Wednesday to the lowest since April 8. In the week ended May 24, money managers cut their net-long positions in gold by 26 percent, the most this year.
In the U.S., where the Federal Reserve has been monitoring signs of economic resilience before deciding on the next increase in borrowing costs, filings for jobless benefits released Thursday fell for a third straight week………………………………………..Full Article: Source

Commodity Hedge Funds Get $5 Billion Embrace on Oil Gain

Posted on 01 June 2016 by VRS  |  Email |Print

The rally in oil has given a fillip to long-suffering commodities hedge funds. After four years of hemorrhaging cash and clients, managers are once again making money and winning back investors.
About $5 billion has coursed into the funds in 2016, with the first quarter seeing the biggest inflows since 2009, according to data compiled by eVestment. Investors are being drawn by gains such as the more than 18 percent increase reported in a letter to clients by Stuart Zimmer’s ZP Energy Fund in New York and the 12.7 percent posted by oil trader Pierre Andurand’s $1.1 billion Commodities Master Fund in London……………………………………….Full Article: Source

Forget gold, oil is the star investment right now!

Posted on 01 June 2016 by VRS  |  Email |Print

Since the turn of the year, the price of gold has risen by around 18%. As a result, many investors are highly optimistic about the prospects for the precious metal and it has clearly been a strong performer in 2016.
A key reason for this is the fact that US interest rates have risen at a much slower pace than expected. When the Federal Reserve increased interest rates in December, it was expected that there would be as many as four rate rises this year, but with none by May, this figure is unlikely to be met. As such, interest-producing assets have been less enticing than was anticipated and the price of gold has risen………………………………………..Full Article: Source

Two Lessons on China and Commodities From Legendary Investor Jim Rogers

Posted on 01 June 2016 by VRS  |  Email |Print

Investor Jim Rogers’ comments from years past are still valid in today’s markets. Maybe not tomorrow, but eventually, China will devalue its currency. And prices for uranium and coal and other undervalued commodities will recover. That’s because, in the end, markets always win.
That’s the application of some of the sage advice from the books of legendary investor Jim Rogers. Rogers co-founded the Quantum Fund, one of the world’s most successful hedge funds, in the early 1970’s. He quit full-time investing in 1980 after generating returns of 4,200% over 10 years………………………………………..Full Article: Source

Gold Price Forecasts Revised Higher – Citi Says “Buy the Dip”

Posted on 31 May 2016 by VRS  |  Email |Print

Gold price forecasts have been revised higher in recent weeks and Citi became the latest bank to revise higher their projections for gold, despite the recent weakness in the price. Citi Research, the research division of one of the world’s biggest banks, raised its gold price forecast to an average $1,280 in the current quarter, $1,300 in the July-September period, and $1,250 in the final three months of the year.
Citi said that despite the recent gold pullback, now is an “opportune moment” for buyers and now is the time to invest in gold………………………………………..Full Article: Source

UBS: Investors Have Opportunity To Buy Gold At ‘More Attractive Levels’

Posted on 30 May 2016 by VRS  |  Email |Print

UBS says any further weakness in gold may be a buying opportunity. The metal has fallen some $90 an ounce from its recent highs, leaving it not far from $1,200 psychological support.
The bank says it’s “understandable” that some investors might be hesitant to buy into weakness, considering recent gains in the U.S. dollar, equities back near the highs for the year, rising 10-year Treasury yields and financial markets pricing in an increased likelihood of Federal Reserve tightening since the start of last week……………………………………….Full Article: Source

Should you start hoarding gold? Some say China’s gold ambitions mean you should keep some stashed at home

Posted on 27 May 2016 by VRS  |  Email |Print

China’s decision to buy its second gold storage vault in London last week was another step towards total dominance of the market. The vault is in a secret location and was bought by Chinese state-owned bank ICBC Standard Bank from Barclays. It could store $90bn of gold at today’s prices, and follows the purchase of a lease on another vault in the capital earlier this year from Deutsche Bank.
London has been a hub for metals investment for hundreds of years, but times have changed and the big banks are pulling back from trading them. Now China is pushing into the gold market in a big way. The reasons why are unclear, and gold continues to spawn more conspiracy theories than the moon landing, but what is known is that China has been amassing the yellow metal at a rapid pace over the last decade………………………………………..Full Article: Source

Banks see worst Q1 in a decade in commodities

Posted on 25 May 2016 by VRS  |  Email |Print

Commodities revenue at the largest banks had the worst start to a year in more than a decade amid a pullback in financing of raw materials. Income at Goldman Sachs Group, Morgan Stanley and 10 other top banks slid by a combined 40 per cent year on year in the three months to March to US$1.1 billion (S$1.5 billion), according to analytics firm Coalition, which tracks commodities activities, including power and gas, oil, metals, coal and agriculture.
Revenue shrank as banks scaled back hedging and financing deals and their hedge-fund clients pulled out of commodities, said Mr Amrit Shahani, a research director at Coalition………………………………………..Full Article: Source

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