George Soros Banks on Gold
George Soros’ investment firm has various reasons to increase its gold investment .
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Soros Fund Management, the investment firm of George Soros, has revealed that it had purchased shares in the largest gold producer in the world, Barrick Gold Corp, even as the prices of gold have risen, increasing by more than 20% since the start of the year. Soros’ move was driven primarily by the increasing demand for gold resulting from the depreciation of the US dollar. There were also worries regarding how effective the monetary policies of the global central banks were. Soros Fund Management has bought 19.4 million shares in the company. It represents 7.5% of the assets of Barrick Gold Corp, amounting to $263.7 million. With a range of cost cutting measures, Barrick Gold’s stock price has soared by up to 100% since the beginning of the year which helped the company deleverage itself. Soros also purchased call options on 1.05 million shares in the SPDR Gold Trust (GLD) exchangetraded fund. However, John Paulson, the hedge fund manager, was not so optimistic on gold. He got rid of the 4.8 million shares he had in the SPDR Gold Trust. Billionaire investor Stan Druckenmiller, who was previously Soros’ chief strategist, shares Soros’ optimism on gold and has indicated that gold gets his largest currency allocation. Soros’ investment firm has cut its American-listed equity holdings by over 33%. It stood at $3.5 billion in the previous quarter. Soros also has a put option amounting to around 2.1 million shares on the SPDR S&P 500, which is double that of 1 million shares at the end of the previous year. Soros has a warning for investors, regarding the economic vulnerability of China and the increasing debt. The debt size of China resembles the debt faced by the US economy before the Great Recession in 2008. In fact, this worry is what analysts believe has led Soros to gold since it is considered as a safe haven that can withstand economic catastrophes. Such far sighted thinking is one of the hallmarks of successful investors. There’s a lot new investors can learn from such seasoned hands, but it all begins with online trading with an efficient trading platform. Get in touch with TradeZero at 954-944-3885 or email support@tradezero.co. -------------------------------------------------------------------------------------------------------------------------------------DISCLAIMER The content provided here is solely for informational and educational purposes and does not constitute an offer to sell or a solicitation to buy any security or instrument which may be referenced upon the site, or an offer to provide advisory or other services by TradeZero in any jurisdiction in which such offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction. Investors are advised not to rely on the information contained in this writing to make an informed investment or financial decision. TradeZero explicitly disclaims all liability for any action taken based on any information contained in this writing.
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