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By Benedicte Gravrand, Opalesque Exclusive:
A recent report from Bank of America Merrill Lynch regarding hedge fund position adjustments and performance for September noted that many funds were in the now crowded gold trade while some also bought other precious metals ( Source).
And yesterday, Reuters reported that hedge-fund manager David Einhorn, president of the New York-based $5bn firm Greenlight Capital, had said he was betting on rising interest rates and holding gold as a hedge for what he described as unsound U.S. policies. “"If monetary and fiscal policies go awry, investors should buy physical gold and gold stocks,” he said at the New York Value Investing Congress (Source).
Which raises an interesting question: why do hedge fund managers buy this most volatile of commodities?
The gold price rallied $10.07 to $1,062.55 per ounce yesterday according to Gold Alert, back near its all-time record close of $1,071 per ounce. But gold mining stocks did not perform as well, with the Market Vectors Gold Mining ETF (GDX) up only $0.15 to $48.53.
At the most recent Opalesque roundtable, ...................... To view our full article Click here
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