Latest news with #GoldIngots
Forbes
29-04-2025
- Business
- Forbes
The ‘Gold' Fund That Could Cost You Thousands In Missed Returns
Image of Gold Ingots on Golden Background getty At my CEF Insider service, we focus on the long term, picking up closed-end funds that give us the capital we need to grow our wealth, plus the high income (I'm talking 8%+ yields here) we need to gain—and keep!—our financial freedom. That said, there's no denying that one particular investment (that's known for neither income nor long-term wealth building!) is getting a lot of attention these days: gold. So let's talk about the yellow metal and why we've avoided it at CEF Insider, despite its recent rise. We'll also look at a closed-end fund (CEF) that looks like a good play on gold but is, in fact, far from it. (Either way, it's a fund I recommend selling now, if you hold it, or avoiding if you don't). You don't have to look too far to see why gold is more of a play for short-term traders. Gold Lags Medium Term Ycharts We only have to go back five years to see gold underperforming the S&P 500, even after the recent selloff in stocks. But let's look at the really long term here. If we go back 33 years (the longest I can go back easily with the software I'm using), you again see that a significant gold holding would be a significant drag on a portfolio. Gold Lags Long Term Ycharts If you are trying to build generational wealth, clearly gold is not the way to go. If you're looking to play short-term extreme price moves? Then gold can work, but it's often no better than a coin flip. Here's why. Gold Coin Flip Results CEF Insider Here we see a few years in the 1970s, when gold (in blue above) crushed the S&P 500 (in red). But since then, the years in which gold has beaten stocks have been rarer. In fact, since 1971, gold has topped stocks 23 times, and stocks have beaten gold 31 times. And if you're interested in the long term, this is the real takeaway: Over this period, gold gave investors a 10.8% average return per year, while stocks returned an average of 12.5%. That's not too much of a difference. But take out the 1970s and gold gave investors a 4.3% annualized return while stocks returned 13.2% annualized return. That's a massive difference and a clear sign that gold is very much not for the long term. Which brings me to that so-called 'gold' CEF I recommend selling now: the GAMCO Global Gold, Natural Resources & Income Trust (GGN). GGN is a good fund, and well managed, but its focus on gold will inevitably drag it down when gold's rally inevitably stumbles—which is why I see it as a sell now. This one is also not a 'pure' gold play: It holds 54% of its portfolio in metals and mining stocks, including notable gold names like Newmont Corp. (NEM) and Kinross Gold (KGC). But it also has miners of other minerals, like Rio Tinto (RIO)—mainly an iron ore miner—and BHP Group (BHP), which focuses mostly on iron ore and copper. Another 33% of GGN's holdings are in energy and energy-services stocks, including top-10 holdings Exxon Mobil (XOM) and Chevron (CVX). That energy focus has been weighing on GGN, since oil has been tumbling with stocks as of late. Nonetheless, investors have been bidding up the fund, shrinking the fund's discount to net asset value (NAV, or the value of its underlying holdings) down close to par. The fund's discount has been shrinking for years after temporarily spiking in mid-2022, during that year's selloff. That's left its current discount near its 10-year average of 3%. In other words, this fund is no longer undervalued, so it risks seeing less demand from investors going forward. This doesn't mean GGN is always a sell, by the way. Buying it on October 1, 2022, near the depths of that year's stock-market pullback, would have been a good move: GGN (in purple below) trounced gold prices—shown by a benchmark index fund, the SPDR Gold Shares (GLD), in orange, and an S&P 500 index fund (in blue) from then until the end of that year: GGN Outperforms Ycharts Since then, though, the story has been very different. GGN Lags Ycharts As you can see above, GGN is well behind the S&P 500 since then, and more or less on par with gold. The fund's 'tie' with gold since brings up another question, though: Why not just buy gold itself? Well, gold has no dividend, so if you want to use your profits, you'll need to know how to time gold's ups and downs in order to sell at the right times to get the cash you need. With GGN, you're at least getting an 8.4% payout. The fund's high dividend effectively turned the volatility in the fund's gold and resources holdings into usable income for investors who held it. What's more, with gold itself—or an ETF that tracks it, like GLD, you will have to be very right about gold in the short term because gold tends to underperform stocks. And since gold has had an unusually strong run as of late, the law of mean reversion suggests that the chances of a bullish bet on gold turning sour are more likely now than they were a few weeks ago. All of this basically leaves us back where we started: If you're in the market for a reliable income stream to provide long-term wealth without the stress of gambling on short-term moves in an unpredictable commodity, you're best to look elsewhere. Michael Foster is the Lead Research Analyst for Contrarian Outlook. For more great income ideas, click here for our latest report 'Indestructible Income: 5 Bargain Funds with Steady 8.6% Dividends.' Disclosure: none
Zawya
27-01-2025
- Business
- Zawya
Bahrain's non-oil exports of national origin hit $2.6bln in Q4
The value of non-oil exports (National Origin) has decreased in Q4 2024 by 1% hitting BD1.002 billion ($2.64 billion) compared to BD1.01 billion ($2.67 billion) for same quarter in 2023. The top 10 countries accounted for 71% of the total export value, according to the Information & eGovernment Authority (iGA). The Kingdom of Saudi Arabia ranked first among countries for then non-oil exports (National Origin) with BD230 million (23%) followed by the US in the second spot with BD130 million (13%) and UAE in the third place with BD81 million (8%), stated iGA in its 2024 Foreign Trade report, which encompasses data on trade balance, imports, national origin exports and re-exports. Unwrought Aluminum Alloys recorded as the top products exported in Q4 netting BD278 million (28%), followed by Agglomerated Iron Ores and Concentrates Alloyed with a value of BD120 million (12%) and Unwrought Aluminum not alloyed with BD77 million (8%). As per the iGA report, the value of non-oil imports has increased by 1% reaching BD1.49 billion in Q4 2024 when comparison to BD1.47 billion for same quarter in 2023. The top 10 countries for imports recorded 71% of the total value of imports, it added. China ranked first for imports to Bahrain, with a total of BD215 million (14%), followed by Australia with BD158 million (11%) and UAE with BD114 million (8%). According to iGA report, Other Aluminum Oxide recorded as the top product imported to Bahrain with a total value of BD149 million (10%), followed by Non-Agglomerated Iron Ores and Concentrates with BD112 million (8%) and Parts for Aircraft Engines being the third with BD66 million (4%). The total value of non-oil re-exports for Q4 surged by 13% to hit BD212 million compared to BD188 million for same quarter in 2023. The top 10 countries in Re-exports accounted for 80% of the re-exported value, stated the report. The UAE ranked first with BD72 million (34%) followed by Kingdom of Saudi Arabia with BD48 million (23%) and Belgium with BD11 million (5%), it added. According to iGA, the turbo-Jets were the top product re-exported from Bahrain with a value of BD33 million (16%), followed by Four Wheel Drive BD24 million (11%), and Gold Ingots came third with BD15 million (7%). As for the Trade Balance, which represents the difference between exports and imports, the deficit recorded BD277 million dinars in Q4 2024 compared to a deficit of BD275 million in Q4 2023, it added.
