iShares COMEX Gold Trust (ETF) (AMEX:IAU)

NetscribeETF (37.64) Submitted: 1/10/2007 7:44:53 AM : Start Price: $6.05 IAU Score: +153.27

iShares COMEX Gold Trust (IAU) is a ETF tracking the daily price fluctuation in the gold prices from the iShare trust family. The fund manages approximately $868 million worth of net assets with about 44.45 tons of gold underlying it. The expense ratio stands at 0.40%, which is low relative to traditional precious-metals funds. Further, the fund offers more convenient and liquid exposure to gold bullion

Gold prices have seen an upsurge since the past half-decade and have focused attention of many investors. Due to the direct correlation with the crude oil and inverse correlation with dollar prices it has attracted attention of investors who use the commodity as an inflation hedging technique and diversifying their portfolio. Analyzing the past, IAU and its rival fund StreetTRACKS Gold Shares both together have fueled the gold prices.

The specialty of the fund is that it does not invest in the stocks of gold producers but each share of the trust represents one tenth of an ounce of gold bullion at current market prices, less the expense ratio. This has proven beneficial, as the price of bullion tends not to be as volatile as gold producers’ stock prices. Additionally, IAU has been able to generate an average annualized yearly return of 22.36% in last one year. Going ahead, the gold prices are expected to see an augment. The supply of gold is coming under pressure due to lack of any big finding in the past years. On the flip side, the demand is ever increasing, thanks to the increasing demand from the largest consumer India. Further, many central banks across the globe have decided to increase their gold reserves which would boost prices.

However, investment in gold could not be considered as tame investment and the historical volatility and the wild fluctuation of gold prices needed to be considered. Further, the tax aspect of investing in gold should be taken into account as the gains on this investment are taxed as ordinary income, at a maximum of 28%, regardless of an investors' holding period. Regardless of few negative factors and backing on the positive aspects, IAU seems a good buy at the current levels.

TMFSinchiruna (66.17) Submitted: 12/17/2006 2:02:27 PM : Start Price: $6.09 IAU Score: +153.40

Gold will surpass its 2006 high fairly early in 2007.

OldNickel (98.26) Submitted: 12/12/2006 1:12:59 PM : Start Price: $6.24 IAU Score: +146.34

Gold's price should increase due to a declining dollar. Most of the major stocks will soon go down, especially with the baby boomers starting to retire shortly, allowing the miners to beat the S&P 500.

daddylight (30.65) Submitted: 10/24/2006 5:11:34 PM : Start Price: $5.78 IAU Score: -163.25

Gold produces nothing. Equities should cover inflation plus productivity growth in the long run while gold will just keep pace with inflation.

laurencekagan (97.30) Submitted: 10/16/2006 3:17:22 PM : Start Price: $5.81 IAU Score: +157.56

its a dangerous world except for India where there are lots of weddings.

BIGANDY1 (98.04) Submitted: 9/19/2006 7:10:03 PM : Start Price: $5.71 IAU Score: +161.36

Gold prices should continue to increase similiar to Late 70's and early 80's price was at 800 Troy oz. Can be very wild ride though.