iShares S&P/TSX Global Gold Index ETF (XGD.TO)

If you don’t want individual gold stocks, and you don’t know the companies, you buy this ETF. It is down, so be prepared to hold it for the long-term. He doesn’t want to hold this.

(A Top Pick Feb 16/16. Up 14.37%.) Hadn’t bought gold for years, but was looking at his core holdings, and likes to do a sector trade occasionally. This one looked good but sold it when the price of gold went up 20%.

(A Top Pick April 18/16. Down 2.86%.) This was a seasonal play. It has had some pretty big swings, but he sees that it has been basing. If we get above the $16 range, it will be good. Seasonality starts for gold stocks in late July.

People need to have weakly and negatively correlated assets, and gold has come back a little this year. Doesn’t feel we are in a situation where gold is likely to pull back anymore. If there is any kind of real or perceived insurrection, this would probably have a positive pop tomorrow. He is recommending 3%-5% for most people, just as a portfolio diversifier.

(A Top Pick April 18/16. Up 5%.) Got out of this in late January/early February. This was a seasonal gold play. We are just starting another seasonal time in gold, about 1.5 months away. If this can get above the $14 level, it is probably going to run back up to its highs.

He trades gold, but it is not a trending thing at this point. The best time to trade gold is generally between July and late fall/early winter. He wouldn’t own gold right now.

Gold is always very much a top pick in Canada, much more so than anywhere else, such as the US. It is also one of those things that people are going to run to when things get unstable and a bit difficult. This ETF has a very large weighting in Barrick (ABX-T), Newmont (NEM-N) and Goldcorp (G-T). His preference would be to own Franco Nevada (FNV-T), a streaming company, that pays a decent dividend, and is not in the business of exploring, drilling and production.

XGD-T vs. CGL-T. CGL-T just holds gold bullion. There is a currency hedge on it. Gold mining companies tend to be pretty correlated over the long term. CGL-T is a more pure exposure and bypasses the gold companies. XGD-T is really just the companies. If you think they have opportunities then this is your vehicle of choice. CGL.C-T is not hedged. XGD-T is an equity investment, CGL-T is a commodity investment.

(A Top Pick Jan 20/17. Down .9%.) The seasonality for gold and gold stocks are identical. Historically they bottom right around the middle of December and then move higher. After that they selloff.

(A Top Pick Feb 26/16. Up 24.31%.) Gold went way up after he had talked about this, and then it dropped, but came back again 2-3 months ago. He recommends gold because it is a great diversifier. It is weakly correlated to other asset classes, and also does very well in times of insurrection and inflation. Still a buy.

His rationale for gold is that people need to always think, from a portfolio perspective. So that instead of cherry picking on how well a security would do, build an entire portfolio and consider how everything would work together. Having something like gold in your portfolio is a good way to improve risk adjusted returns. A great thing to have in your portfolio, with a small sliver, 3%-5% as a long-term Hold.

Most of the gold ETF’s are quite reasonable. They reduce the risk in terms of you not putting all your eggs in one basket. The question is, should you be buying a gold ETF. He would prefer SPDR Gold (GLD-N) gold itself, rather than a basket of companies. It is a little early on gold. Still too much uncertainty as to when the US$ is going to recover. It may continue to weaken.

Historically, gold stocks do very well from approximately the middle of December right through until the 1^st week in March, which is the miners’ PDAC conference. At that time, you take your profits. Technicals on gold are all lined up at the same time that the seasonality is just coming together.

This is called a Global Gold ETF, but has about 70% exposure to Canadian gold companies, so it is really Canada centric. He thinks of it as a Canadian equity ETF. If you want to diversify, this is probably not the way to go. As an alternative, you could buy a gold bullion ETF.

(A Top Pick Feb 26/16. Up 16.3%.) It has been a good year for gold. It’s sold off a lot in the past 4-5 months, but still a really good thing to have in your portfolio. You should use this judiciously, 3%-5% of your portfolio.