Eight Legendary Gold Investors

There is no shortage of self-described “gold bugs” in the current environment, as an increasing number of investors are adding allocations to precious metals to their portfolios and embracing gold in particular as a core holding. And those with a bullish outlook on gold aren’t simply limited to small investors storing all of their assets in gold coins or other collectibles; many managers of multi-billion dollar funds have huge positions in the yellow metal, contributing to more mainstream acceptance of this asset class as a potentially critical portfolio component: 

  1. Eric Sprott: Eric is the president of Sprott Asset Management, a firm that has close to $5 billion in assets under management.  Currently, the company has three products targeting the gold space including a precious mineral fund, gold bullion fund, and a physical gold trust. However, Sprott’s love of the precious metal space extends beyond the company’s funds; in a recent interview Sprott declared that he had roughly 40% of his portfolio in the precious metal segment with a large chunk going to physical gold. With figures like that it’s easy to see why Sprott also called gold a ‘go-to asset’ that is great for any investment climate.
  2. Jim Rogers: Rogers’ fortune was largely amassed from his work with George Soros starting the Quantum Fund, which has turned in some eye-popping returns over the last several decades. Lately, Rogers has become an outspoken critic of U.S. policies and has moved to Singapore in order to be closer to what he sees as the real action in Asia. Due to this view regarding Asia’s growth prospects, Rogers has become a huge commodity bull, investing in everything from corn and farmland to a variety of more industrial metals. Rogers has also become a bull on gold, recently declaring that the yellow metal will go to $2,000/oz. this decade. Rogers has also decried those who have claimed that gold is at the top of its bull market, declaring that the metal has not become frothy and that large numbers of people still do not have exposure to the yellow metal.
  3. Jim Sinclair: Sinclair is a precious metal expert with decades of experience across multiple sectors of the industry. Currently, Sinclair is the Chairman of Tan Range, a company that is looking to become a gold royalty firm. More recently, Sinclair was in the news for offering a bet to any gold bear of one million dollars that the price of gold would hit $1,650 by the end of the second week of January 2011. While there was no word on if anyone took up Sinclair on the offer—as gold did not hit that mark in January—it further demonstrates the level of confidence that he has in the yellow metal. Sinclair also publishes a blog entitled “Jim Sinclair’s MineSet” which is designed to give investors commentary about the gold market and is free to all.
  4. John C. Hathaway: A rising star in the gold world, Hathaway manages a series of products that have a tilt towards the yellow metal. Among the most popular funds are the Tocqueville Gold Fund, Tocqueville Gold Partners, as well as separate accounts for individuals and institutional clients following a gold strategy. At the time of writing, Hathaway’s Tocqueville Gold Fund was the among the best performing mutual fund in the gold equities space, outpacing the category average for all time frames longer than one month.
  5. Joseph M. Foster: Foster may not be nearly as well known as some of the other names on this list but that shouldn’t stop you from learning a little more about him. Foster, who got his start with Van Eck in 1996 as a precious metals mining analyst, is currently a lead investment team member for the company’s popular product the Van Eck International Investors Gold Fund.  In this role, Foster has led the fund into the top spot in the gold mutual fund space over the last five years, giving investors a return of roughly 20% or close to 600 basis points above the category average.
  6. John Paulson: Paulson made a name for himself in the financial crisis of 2008 in which he correctly predicted the turmoil that many banks would face in the years ahead. Now Paulson is predicting high levels of inflation in the coming months and years and is looking to gold to help mitigate this onslaught. In fact, Paulson also has a Gold Fund which has close to $900 billion in AUM which was up more than 30% last year alone. In some of his other funds, Paulson has heavy bets on gold ETFs such as GLD, as well as over $1.8 billion in AU and $550 billion in KGC. With so much of his capital riding on the performance of gold investors would be wise to follow Paulson’s holdings for more clues on gold’s price in the months ahead.
  7. George Soros: Arguably the most controversial investor on the list, Soros has recently declared that gold is ‘the ultimate bubble’ but has nevertheless poured vast amounts of capital into funds tracking gold as well as equities of companies that produce the product.  In particular, Soros has been a huge fan of the ultra-popular GLD despite its relatively expensive cost. This is probably due to the fund’s superior volume levels which could allow the money manager to quickly move out of the product should things take a turn for the worse in the gold market. Additionally, he also has some exposure to the Market Vectors Gold Miners ETF (GDX) which is seen by many as a leveraged play on the price of gold.
  8. Marc Faber: The famous Swiss fund manager who publishes the ‘Gloom Boom & Doom report’ has been a goldbug for years. This is largely due to what Faber calls ‘inflationary policies’ by the Federal Reserve in the U.S. which the investor believes will likely cause the U.S. dollar to continue to deprecate making gold an intriguing investment for those looking to preserve capital. Marc also believes that gold is not in a bubble state and still has plenty of room to run before it tops out. “If it were a bubble a lot of people would have gold. The whole world would be trading gold 24 hours a day. But I don’t think it’s really a bubble. I think gold is maybe cheaper today than it was in 1999, when it was $252.”
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