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Gold, Oil, Stocks All Up - Money Matters for 9/29/05 Don Bravo | 9/29/05
Today's sentiment rally in stocks was more than matched by continued gains in precious metals, which begs the question, how does that happen?
One can only assume that the increases and gold and silver are for real (oil was up slightly as well), while the moves on the equity markets were nothing more than end-of-quarter fund shenanigans.
It's likely that many good-intentioned funds were dumping their losers and buying up prospective winners in the penultimate day of trading for the month and the third quarter. What is not likely is these same funds buying precious metals as a protective hedge or even an outright investment.
Most fund managers toss off gold and silver as though they don't exist. That goes to their peril, of course, as gold bugs have had a run over the past three years that's nothing short of spectacular.
Even if one missed the initial run up in gold, from roughly $270 to $320 from July '01 to November '02, it was still not too late. Gold has been hovering around the $465-$475 mark for the past week and it shows no sign of letting up any time soon.
Those holding only stocks and no gold are doing their portfolio a serious disservice. Not only is gold an admirable hedge in most times, it is becoming the investment of choice for the truly wealthy who see not only the inherent safety in the metal, but the potential to reach even more stunning levels in coming months and years.
Aficionados of gold have also been touting silver, which has had an incredible boost just in the past two weeks, and platinum, which has already more than doubled in value from mid-2001. But it's always been gold that got everyone's juices flowing and it will likely be gold to keep investors happy for many years to come.
While the stock markets gyrate about in narrow ranges, precious metals are turning out to be the shining stars in the investment world of 2005.
THE NUMBERS:
Dow Jones: +79.69; 10,552.78 close
NYSE Advancers: 2276
Nasdaq Advancers: 1932
NYSE New Highs: 186
Nasdaq New Highs: 99
Gold: +2.70; 475.80 close
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