From Good to Great Gold
Kristen Lush - www.TheGoldSector.com
June 4th, 2006
A subscriber sent us a question this weekend about why we don't focus on other funds which are performing well like the Internet Holders, Biotech holders and Broadband holder funds. Our focus is obviously in the precious metals industry but from time to time we will focus on other hot industries if it has more potential than PM's. Below is a simple comparison of good investing and great investing using funds.
Subscribers Ideal Funds vs TheGoldSector Ideal Funds
Sorry for the tangled chart above but its not as bad as it looks J
The chart above is a 9 month performance chart which has the three funds that our member mentioned which are the Internet, Biotech and Broadband funds. We like to focus on the hottest industries and the PM's have been on fire for the last few years. In the chart above we have listed the funds we are currently focusing on. They are StreetTRACK Gold Trust, Gold Miners Fund GDX, the US Global Investor Gold Fund USERX and the new Silver Fund SLV.
I'm not sure how this person came up with the Biotech holders as a performer but I posted it anyways. You will notice that the bottom performing funds are Internet, Biotech and Broadband which this person is following. The top 4 fund are the hot PM funds that provide consistent and highly profitable setups time and time again.
Investing in sectors or industries that are out performing the rest of the market generally provides the best opportunities for trading. Not only are the setups more accurate but the returns are much higher per trade.
Good to Great Gold Funds
As you can see in this chart I have 5 Gold funds listed. The bottom fund which is up over 150% is GLD. This is a fund that owns Gold Bars thus it tracks and performs the same as the price of gold. As we move to the other funds they each contain a different portfolio for PM commodities and stocks which increases the volatility.
Members of our service are provided signals for these funds which allow them to pick and choose the level of volatility they want in their portfolio.
Precious Metals Out Performing S&P 500
PM's have been on fire the last 6 months and by comparing these two metals to the performance of the S&P 500 it is obvious where the money is going. Our members will soon have our FREE Futures Auto Trading Service available so they can take advantage of the leverage without having to know much about futures trading. Our affiliate broker will execute all contracts using our real-time intraday trading signals. Members will have the option to trade the Mini Gold (33.4 oz) or the full Gold (100 oz) contracts.
Trading Gold More Accurately
Bullish Gold Rush
One little trick to helping time your positions in gold is to follow PM stocks. The PINK LINE is the price of gold action. Smart money usually leads and flows into Gold stocks making gold funds out perform the price of gold (pink line). When the major funds are out performing the price of gold we start looking for a low risk entry point if we are not already in position.
Bearish Gold Bomb
Gold Price Action is the pink line again. This time it is out performing all gold funds which tells us smart money is leaving the industry for the time being. Again this is an early indicator which allows us to tighten our stops to lock in profits.
Final Note:
It does not matter what you trade but it all comes down to a few important key rules. Trade only low risk setups with a high potential return. Use thorough non-bias analysis and stick to your entry and exit points. Happy Trading!
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