Issue: 344
Sent: 07-07-2009 13:36:02
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Investment Roles for GoldEmail Marketing Business Opportunity - Helen BairstowManaging People: Getting HelpThe Easiest way to do a Client NewsletterCharges for Excess Broadband Data UseWhy Warren Buffett won't buy a NewspaperTrouble Ahead for Self Managed Super Funds?How do I use ATC articles for my clients?
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Investment Roles for Gold

Click here to buy - A How To Book of SMSF's by Tony Negline
John Robertson

The unique investment status of gold rested to a large extent on the absence of competitive products. Today, when the need for safe havens is more striking than ever, gold has not responded as well as we might have expected.

Financial market conditions during the past 18 months should have suited gold-related investments. If anything, the gold price reaction and the share price responses of gold producing companies to the global credit crisis have been disappointingly weak.

An article in the AllThingsConsidered e-mail on 24 February discussed the poor returns from gold related investments despite the precious metal seemingly enjoying some of the best conditions imaginable for an appreciation in its price.

The article highlighted the possibility that, over time, the historical role of gold as a protective haven against the shortcomings of fiat currencies could be gradually coming to an end. That would not happen abruptly. Rather, over a long time, competing investments would gradually erode its historical position and eventually take its place.

There is a lengthier discussion of these and other issues relating to the use of gold as an investment asset in Editions 57 and 58 of the monthly ATC Digest. Readers can sample a free copy or subscribe from

The first of the two ATC Digest articles picks up on the thoughts contained in the February e-mail. It focuses on the background to gold being accorded a unique status among investments and the potential advantages for portfolio construction from using gold as an asset.

Shares in gold producing companies are an intuitively attractive alternative to physical gold as an investment medium. The second ATC Digest article discusses the role of gold-related equities and their connection to movements in the gold price.

As always, there will be specific circumstances under which broad conclusions do not hold but the balance of the data seems to support five conclusions about the role of gold and gold related equities.

These are the five principal conclusions to come from the analysis and discussion of the gold market contained in the two ATC Digest articles.

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This email is general in nature only and does not constitute or convey specific or professional advice. Legislation changes may occur quickly. Formal advice should be sought before acting in any of the areas discussed. Be aware that the information in these articles may become innaccurate with time. Responsibility is disclaimed for any inaccuracies, errors or omissions. Particular investments are neither invited nor recommended and hence this publication is not "financial product advice" as defined in Section 766B of the above legislation. All expressions of opinion by contributors are published on the basis that they are not to be regarded as expressing the official opinion of any other person or entity unless expressly stated. No responsibility for the accuracy of the opinions or information contained in the contributor's articles is accepted by any other person or entity. Copyright: This publication is copyright. If you wish to reproduce this article you require a license, which can be purchased here, to do so.

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