Gold is quickly becoming a popular trade for hedge funds, Henry Blodget of Yahoo Tech Ticker reported.
With currencies around the globe taking a nosedive from too much printing by their governments, gold is being seen as a greater safe haven.
John Paulson, of Paulson & Co., and David Einhorn, of Greenlight Capital, are both huge fans of investing in gold, Yahoo Tech Ticker reported.
Both believe that investors will turn towards gold when currencies are devalued.
Greg Zuckerman, author of "The Greatest Trade Ever," agrees with Paulson.
Paulson and Einhorn were not fans of gold a few years ago, Zuckerman points out.
Both do not see other investing alternatives to purchasing gold.
Other well-known hedge fund managers, such as Bill Ackman of Pershing Square, are betting against gold because they believe the commodity lacks value.
Zuckerman said the market could be in a period where investors are “chasing gold.”
He predicts that prices for gold will “edge higher,” but will also experience “bouts” where prices decline by $100 to $200 per ounce.
He advises that investors have “some” exposure to gold, but not invest too much since prices are not likely to “soar.”
Declining interest rates are also boosting the prices of precious metals, Bloomberg reported.
“Precious metals become more attractive in an environment of falling interest rates,” Stefan Graber, an analyst at Credit Suisse Group AG, wrote in a note.
“Yields reached very low levels in 2009, and if they turn higher, we could see renewed profit-taking in precious metals, particularly for gold and silver.”
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