The scale of the Chinese demand is going to create substantial opportunity for gold investors.
Now, gold investors who hold on may be facing their first annual loss since 2000.
As 2012 rolls on, gold investors are slowly, but surely, taking it toward the other side.
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At least gold investors seem to have a better idea of what is going on.
The weakening dollar is good news for gold investors and gives at least a short-term boost to U.S. companies who do business overseas.
Longer-term gold investors, who have become more price conscious, would likely see a dip to that zone as a buying opportunity.
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Unfortunately, for gold investors, its price is down 17% from its high.
As a result, recent events may be causing some of the more recent gold investors to take profits or exit the precious metal altogether.
Gold investors are becoming more price conscious and price sensitive on the buy side and the retreat to the lowest levels since late August was seen as attractive.
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Most gold investors believe that gold has a limited downside , at least until interest rates begin to rise enough to cost them real money in carrying their positions.
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The bullish argument can be made by looking at fundamentals underpinning the market, though, as gold investors will see the market tightening around stagnant production and higher demand through 2011.
Other gold investors believe that continued weakness in the dollar will attract more gold investors like the central banks of China, Russia and India, who see the precious metal as an alternative to paper currency.
An interesting option could be Yamana Gold, which has delivered a 15% return in the last three months and beaten bullion and its general peer group. (Read Existential Gold Investors Seek Fresh Catalysts).
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Regardless of whether there is a building gold bubble about to burst or if new highs are in the pipeline, the pertinent question for jewelry stocks is if demand from gold investors outweighs jewelry buyers.
Still, India's dry spell is what is captivating gold investors now and likely to be the primary obstacle to higher prices for the rest of the year, said Jon Nadler, senior metals analyst with Kitco Metals Inc.
Again, it is in fact more susceptible, as this past week showed, due to the fact that an abundance of emotions are involved in the gold investment thesis amongst the army of gold investors that currently exist.
All gold investors should beware.
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Other large gold investors include Tom Kaplan, who owns a major position in Novagold(NG), a Canadian company, Frank Giustra, a Canadian mining entrepreneur, The University of Texas pension fund and many others such as US Global Investors, a mutual fund company in San Antonio, Texas.
Using the Goldman Sachs Commodities Index as a proxy for the costs of mining (because it is heavily weighted towards industrial commodities), the real cost of mining gold jumped by nearly 50% during this period, explaining why gold stocks did not provide the leverage that gold investors expected.
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There is a caveat for gold stock investors in the short-term, though.
However, Day warns that if stock prices were to tumble sharply, that could cause margin-account selling and could limit strength in gold as investors sell profitable assets.
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The purported plots against gold loving investors are pretty convoluted.
As gold aversion surged, investors bought gold to hedge out tail risk and destructive scenarios, including a Cypriot Eurozone exit and political risk in Italy, where Pier Luigi Bersani has failed to garner support from Silvio Berlusconi and Beppe Grillo of the 5-Star Movement to form a government.
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But although the likes of American Barrick have received plaudits from investors for such a strategy, other firms have been willing to suffer the vicissitudes of the gold market because investors want more exposure to the price of gold.
Since 1956, Van Eck has offered a mutual fund that holds gold-mining shares the Van Eck International Investors Gold Fund (INIVX).
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Historically gold companies calculated total cash costs per ounce by including only mining, processing, selling and royalty costs, said Imaru Casanova, senior gold analyst and investment team member of the Van Eck International Investors Gold Fund (INIVX) and the Van Eck Global Hard Assets Fund (GHAAX).
Centuries of emotional conditioning and pent up demand will stimulate the demand for the gold fund as investors hope to participate in the road to riches by owning gold.
With so much attention on gold lately, growth investors should take note: Stocks of gold and other commodities should be treated exactly the same as any other stock.
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He has bet that gold prices will fall further in coming months as more investors shed gold.
Certainly, many gold traders and investors are unnerved by such volatile daily price action.
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