Get Paid To own Gold?

Discussion in 'Trading' started by marketsurfer, Feb 25, 2013.

  1. This new ETF pays you to own gold-- think its too good to be true? think again

    ow would you like to be paid to own gold?

    Of course, you would.

    This idea seems particularly attractive in light of the market's recent selling pressure. And I am not talking about any complex option strategies or anything illegal. In fact, it's a brand-new exchange-traded note (ETN) that does everything automatically.

    Is there risk? As with any investment, certainly. But here's the right question to ask: Does this make sense for your portfolio?

    Let's take a look at the big picture behind this intriguing new ETN...

    Investing in gold is an enigma. After all, the yellow metal is used in everything from industrial applications to fine jewelry. In addition, it has been serving as a currency for thousands of years.

    The most fervent gold investors, or "Gold Bugs," say gold is the ultimate investment. And the truth is that Gold Bugs have been laughing all the way to bank since 2005, when gold rocketed more than 280% to $1,910 an ounce in 2011.

    Everyone was in a frenzy then. Physical gold buyers opened up shop on nearly every street corner wanting to buy your gold jewelry and scrap gold to melt down for a fast profit. Central banks jumped on the bandwagon, ramping up their holdings. Investors followed, setting records for ......
  2. zdreg


    you are joking. this a rip off product
  3. Explain what you mean-- is the strategy flawed?
  4. zdreg


    you are giving a way the upside potential while losing a lot in a significant downturn.
  5. 1) It's a "good" instrument in a sideways/stagnant market. :)
    2) Even then, the "income" from selling the out-of-the-money call options would taper off in such a scenario. :mad:
    3) The author of that article should change his last name to "Goodman". :cool:
  6. Tiras


    There is a well-developed market in the institutional world, where physical gold (and other metals) are leased. Lessors are normally banks who do it for arbitrage and precious metals (PM) manufacturers / dealers who do it for other various reasons. Lessees are normally chemical companies that use it as catalyst in reactors – it is a financing transition for them. Risk is, of course, credit risk of the lessee that is limited to the shortage of PM to be recovered in case lessee goes into liquidation, plus time and money spent on the recovery process. Getting paid for owning PM is not new, but is not available to retail.
  7. I don't see the point of the horrific expense ratio when you can simply write the calls yourself.
  8. interesting, thanks for sharing the info, what's the minimum size to lease physical gold? I have a friend with what I would consider a large quantity of scrap gold-- is leasing an option? surf
  9. Which has nothing to do with this thread. It's a CC fund.
  10. what a terrible product lol.
    #10     Feb 25, 2013