Look at the huge difference in performance today. GG, Goldcorp, is up 3.68% and a gold ETF, IAU, which reflects gold bullion, is up .13%. Why the difference?
My guess, hedge funds need cash to pay-off redemptions, people pulling-out of the Hedge Fund. They have profits in the ETF and easy liquidation. Look into it. See what you think.
But remember, there is a lot more risk with a mining company which should create a bigger upside (although often lagging the futures market of gold) and when the company has issues, a downside, that is not necessarily reflected in the price of the metal in the futures market or in the ETF. Why own both?
Goldcorp Inc
Goldcorp Inc |
46.21 1.64 (3.68%) |
10 | $462.10 | |
IAU
Ishares Gold Trust
Ishares Gold Trust |
15.83 0.02 (0.13%) |
5 | $79.15 |
Gold bulliion ETF reflects price of gold. Gold company reflects profits, price to produce/mine the metal and the price they receive when metal is sold on the market(usually this is a lot more). Companies have floods, acidents, can be managed poorly, mine can be in a war zone etc Pros and cons for each.