- If it seems like it takes a lot more today to move the price of gold around than it did a few years ago, ETFs could be the reason, write Luzi-Ann Javier and Susanne Barton at Bloomberg.
- ETFs account for about two-thirds of the $113B invested in precious metals, according to RBC's Chris Louney, and that sort of retail interest and more constant state of demand is dampening price swings.
- One example: When the U.S. last month in Afghanistan dropped the largest non-nuclear bomb ever used in combat, gold rose 0.1%. On June 24, 2004 - amid bomb explosions in Iraq and Turkey - gold advanced 1.6%.
- "Geopolitical events serve as less of a long-term driver of the gold price,” says RBC's Stephen Walker. “It’s the purchase of the ETFs — that’s been driving the gold price versus systemic risk around politics.”
- ETFs: GLD, IAU, PHYS, SGOL, UGL, DGP, GTU, UGLD, GLL, DZZ, GLDI, OUNZ, DGL, DGZ, DGLD, GYEN, GEUR, UBG, QGLDX, GHE, GHS, GLDW
- Now read: Forget Gold... At Least Until June
Original article