Leveraged Gold is the most widely held and popular commodity globally. It deserves this tag due to several reasons. The United States dollar serves as the reserve currency meaning foreign currency held by different countries to pay their international debt and influence their local exchange rate. Often goods like gold / oil are rated in reserve currency and purchasing them means paying off in the reserve currency. So when dollar rates fall, commodities like gold become more attractive due to the security it offers and so are the related vehicles like the Gold mining funds and securities and interestingly for market veterans, each act as an indicator for the other.
A dip on a dollar in turn pushes the cost of gold as one saw in year 2008; its price reached approximately $ 1000 an ounce and doubled between the years 2008 - 2012 respectively.
Historically though, miner equity has outperformed the gains from the physical gold in almost every past rally and considering that the long term Gold upside is still intact owing to the decreasing mining output, selective investments in Pure Gold Miner funds and stocks may repeat the performance in all likelihood.
Further gold is an admirable hedge against price rises and increased living costs. Its prices tend to rise greatly during a period of inflation. Also in times of global crisis or political instability the above metal provides a safety cushion to its loyalists.
According, to an estimate by BullionVault.com the global mining output dropped from about 2580 metric tons in year 2000 to around 2440 metric tons of the yellow metal in year 2007 and in 2011 the production touched close to 2700 metric tons according to GoldSheetlinks.com.
India's consumption for this valuable commodity is one of the largest in the world. Even China has one of the top spots in consumption mostly in the form of gold bullion. Analysts too, have confirmed that a majority of future demand is going to arise from the Emerging Markets like the BRIC or the ASEAN Trade Bloc and for this reason only; investment in Gold Miners ETFs may be easily termed as play on the emerging economies as well.
Investors are loaded with options when it comes to gold investing - trading gold futures, gold indexes, and stocks of gold mining companies, gold miner funds and physical gold itself. It helps in achieving a diversified portfolio and reducing volatility and risk as gold is not correlated to stocks and other financial tools.
The physical prices tend to increase when a situation causes a decline in worth of stocks and bonds; on the other hand Pure Gold Mining Funds are more liquid and bear lower expenses when compared to speculation in gold bullion.
Gold mining is a big industry in the sense that many companies are devoted to the mining of this exquisite metal. There are funds that track indexes such as the Solactive Pure Gold Miner's Index; The NASDAQ associated benchmark comprises of 27 holdings that include firms like Eldorado gold Corp. and Alamos gold Inc.
Market Traded Gold Miners ETF serve as a pre and wisely selected mini collection of the gold mining companies and the added benefits of tax savings, discounted fees and commissions. The biggest plus with ETFs in general is a far greater liquidity and of course a much diversified and balanced exposure to most liquid gold miner equity from around the world which enjoys a significant first mover's advantage over any other gold centric investment.
Pure Gold Miners Fund delivers as per the movement of the top 27 Global Gold Mining Equity that makes up the Solactive Global Pure Gold Miners Index. The annual expenses stand at 0.59%. The top four stocks for this Gold Miners Fund are ALACER GOLD CORPORATION, PERSEUS MINING LIMITED, ALAMOS GOLD INC and ZHAOJIN MINING INDUSTRY sharing allocations close to 5% each.