Will Gold Prove Some Investors Wrong This Year?
If gold made a New Year’s resolution to convince investors that it was undervalued and ignored for too long, then the precious metal is certainly keeping its commitment so far. After a dismal performance in 2013, gold is one of the best performers this year, and Mr. Market is starting to take notice.
In only two and a half months the price of gold has managed to jump nearly 14 percent, marking its best start to a year in decades. The miners logged even more impressive performances. Shares of the Market Vectors Gold Miners Index (NYSE:GDX) have gained 31 percent year-to-date, while its junior counterpart surged 44 percent. Silver, often referred to as gold’s little brother, has also participated in the recent rally. Shares of the Global X Silver Miners ETF (NYSE:SIL) have increased 27 percent this year.
Last month, the SPDR Gold Trust (NYSE:GLD), which is the world’s largest gold exchange-traded fund, experienced its first month of inflows in more than a year. Inflows have remained strong in March, and could be reversing the massive outflow trend seen last year. In 2013, ETFs and similar products witnessed outflows of 880.8 tonnes, compared to inflows of 279.1 tonnes in the previous year, according to the World Gold Council.