With uncertainty and risk aversion dominating investor psychology in the first quarter of the year, gold ETFs have benefited, increasing dramatically in the first three months of 2009. According to the World Gold Council, investments in gold ETFs increased to $13.58 billion in the first quarter, representing more than six times the amount held in the same period during 2008 and more than five times the amount held in the fourth quarter of 2008.
As fears of a prolonged global recession intensified in February and March, investors pulled money out of equities and turned to less risky investments, such as Treasuries and gold. Even as the market has rallied in recent months, reflecting increased investor willingness to take risks, many analysts believe that gold prices will find support from continued inflation concerns, particularly on the heels of massive stimulus packages implemented by the U.S. and other governments.
There are a variety of ETFs available offering exposure to gold, including:
- SPDR Gold Trust (GLD)
- iShares COMEX Gold Trust (IAU)
- DB Gold Double Long ETN (DGP)
- DB Gold Short ETN (DGZ)
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