In the middle of the second straight day of market slides, some investors might want to check in on their gold and precious metals investments as a reminder that they have security in other areas.
Unfortunately, that isn’t what they’ll find. Gold is not doing well of late, either. Despite hitting eight-month highs to start the year, with January and February prices around the $1330s, the price of gold has consistently fallen for the past two months-plus. Currently, it sits down around $1,270.
That’s a 6% drop in less than three months’ time, which is obviously not what gold investors would want. But Mark Hulbert at the Street is pointing out that gold investors don’t seem to be too worried, at least not yet.
Speaking on those short-term gold investors he monitors, he said they remain “relatively sanguine.”
“Instead of becoming pessimistic and dejected, which is their usual pattern in the face of pronounced market weakness, they have only modestly and begrudgingly reduced their recommended gold market exposure levels.”
What does all this mean? It means that the gold contrarians may be right. But that doesn’t mean you shouldn’t invest. As Hulbert explains:
“To the extent contrarian analysis is right, a better, lower-risk buying opportunity on the path to those higher levels is still in our future.”