"The rising price of gold has truly been an incredible phenomenon to watch in recent years. Indeed, spot gold prices have surged from around $1,800 per ounce five years ago to nearly $4,100 per ounce at the time of writing. That's good for a return of 128% over this period, much better than the roughly 80% return the S&P 500 has provided over the same time frame."
"So, are investors who are very overweight gold likely to outperform over the next five years? It's hard to say. There are a number of dynamics driving the price of gold higher right now that may take a breather at some point. From institutional buying to central banks looking to bolster their currencies, there are a myriad of reasons that gold is surging that has nothing to do with you or I buying a few ounces here or there."
"For active and passive investors alike looking for an exchange traded fund which closely tracks the price of gold, the SPDR Gold Shares ETF ( GLD) is an excellent option to consider, in my view. Indeed, this ETF's ability to track the price of gold tightly, while providing investors with the ability to benefit from surging retail and institutional demand for gold means this is about as good as it gets in terms of providing highly liquid exposure to the price of gold over time."
Spot gold surged from about $1,800 per ounce five years ago to nearly $4,100 per ounce, delivering a 128% return versus the S&P 500's roughly 80% return. Multiple dynamics, including institutional buying and central bank purchases to bolster currencies, are driving the rally and could pause. Precious metals serve as a diversification tool within portfolios. The SPDR Gold Shares ETF (GLD) closely tracks gold prices, provides highly liquid exposure to rising retail and institutional demand, and functions as a benchmark and lower-risk vehicle compared with leveraged alternatives.
Read at 24/7 Wall St.
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