Finding a hidden nugget of gold

Gold is cheap now but chances are you already have enough.



From the June 2013 issue of the magazine.


As gold prices drop from their lofty heights, some investors are wondering if it’s a good time to buy the precious metal. Sure, prices are cheaper now, but before loading up on gold, you’d be wise to first take a close look at your own portfolio.

If you’re invested in the Canadian stock market, there’s a good chance you already have some exposure to gold. The S&P/TSX 60 holds nine companies that mine or explore for the metal: firms like Goldcorp, Barrick Gold and Yamana Gold comprise more than 8% of the index. Some of these companies use futures to hedge their exposure to gold prices, says Laurence Booth, a professor at the Rotman School of Management, but their fates are still tied to prices because they produce more when gold is expensive. “You’ve got exposure to gold when you buy an ETF that tracks Canadian stocks,” says Booth, “so make sure you’re not double-counting.”

4 comments on “Finding a hidden nugget of gold

  1. Gold: Should You Buy or Shouldn’t You?
    I must confess. I’ve never been much of a gold bug so my answer to that question might not be the more common response. And I admit I’ve never understood how the market values gold or the reasoning behind holding gold.


  2. I am getting a FREE subscription of Money Sense from Rogers. Now I've got something notifying me that I will be CHARGE for the copy. I did not authorized Money Sense to charge me for their copy. Please stop sending me a copy or any other magazines. I don't have time to read it.

    Maria Pucovsky


  3. Asking if you should buy gold (now or anytime) is just like asking if you should buy buy real estate. If you a short term investor – in either – you can get caught out, just like so many did when gold took a nose dive and when the real estate bubble burst. But, if you can buy on hold on for the long term – anytime is a good time to buy gold – for the long term.


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