GLD Suddenly Jumps To Its Highest Levels Since Before The Election

The price of Gold has been on a tear since mid-March, and the largest tracking ETP, GLD (SPDR Gold, Expense Ratio 0.40%) today is trading at its highest level since last November — before Trump’s election.

The fund, which is the 12th largest fund in the entire U.S. listed ETF landscape in terms of asset size (over $35 billion presently), has seen healthy inflows year-to-date, to the tune of about $875 million in.

Whether one is a fan or not of the President, no one can deny that the U.S. Dollar has responded negatively to his comments recently when Trump stated, according to a article titled “U.S. Dollar Drops Sharply After Trump Calls It “Too Strong,” the following:

“I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me.”

Since these comments, the U.S. Dollar has been a net loser five out of six trading days, including a gap down today that brings it back to mid-March lows, and this effect certainly has helped Gold prices lately, which tend to benefit when the U.S. Dollar slumps.

Several other “Long Gold” ETPs are worth following here as well, especially if Gold continues to break out, and they include the $8.3 billion IAU (iShares Gold, Expense Ratio 0.25%), the $1 billion SGOL (ETFS Physical Swiss Gold Shares, Expense Ratio 0.39%), as well as several Leveraged “Bull” funds like:

  • DGP (Deutsche DB Gold Double Long ETN, Expense Ratio 0.75%),
  • UGLD (VelocityShares 3X Long Gold ETN, Expense Ratio 1.35%), and
  • UGL (ProShares Ultra Gold, Expense Ratio 0.95%).

The funds above which tend to catch interest in such market conditions, when gold is moving substantially higher.

On the other hand, profit takers or Gold Bears at these level may look to the following:

  • GLL (ProShares UltraShort Gold, Expense Ratio 0.95%),
  • DZZ (Deutsche DB Gold Double Short ETN, Expense Ratio 0.75%),
  • DGZ (PowerShares DB Gold Short ETN, Expense Ratio 0.75%), and
  • DGLD (VelocityShares 3X Inverse Gold ETN, Expense Ratio 1.35%)

These leveraged bear plays are good choices if you’re looking to fade the current move higher in gold prices.

The SPDR Gold Trust ETF (NYSE:GLD) was trading at $122.88 per share on Tuesday afternoon, up $0.64 (+0.52%). Year-to-date, GLD has gained 12.11%, versus a 4.59% rise in the benchmark S&P 500 index during the same period.

GLD currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 33 ETFs in the Precious Metals ETFs category.

About the Author: Paul Weisbruch

paul-weisbruchPaul Weisbruch is the VP of ETF/Options Sales and Trading at Street One Financial. Prior to joining the team at Street One, Paul served as the Director of RIA and Institutional ETF Sales at RevenueShares ETFs from December 2007 until November of 2009. Before RevenueShares, Paul was employed by Susquehanna International Group from 2000 until 2007 serving in roles including OTC/NYSE Institutional Block Trading, Nasdaq/OTC Market Making, ETF/Derivatives Intelligence and Strategy, Algorithmic Trading, as well as acting as the PHLX Floor Specialist in the ETFs, SPY and DIA.Paul has been actively involved in the ETF space from both a product and trading standpoint since 2000. Additionally, Paul has well forged relationships with national RIAs, institutional pension fund managers and consultants, mutual fund and hedge fund managers, and also the ETF media. Co-authoring the “S1F ETF Daily” since 2009, the daily piece has become a must for many portfolio managers in the ETF space, with segments regularly appearing in the likes of Barron’s, WSJ, and for instance.

He holds his Series 4 (Registered Options Principal), 6, 7, 55 (Equity Trader), 63, and 65 licenses. He graduated from the University of Pittsburgh (B.S. – Economics), graduating magna cum laude, and has an MBA from Villanova University.

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