1/4 oz. Gold American Eagle Coin

The Wall Street Journal just released a very interesting article that compares gold futures, which are most closely tracked in value by gold bullion and gold coins, to other investments, and the returns that have been tracked so far this year. The author, Myra P. Saefong, looked at the S&P 500, Barclay’s U.S. Bond Index, iShares Emerging Markets Fund, Bitcoins, the ICE U.S. Dollar Index, and even the SPDR Gold ETF. This is what she found:

The S&P Vs. Gold Coins And Gold Bullion
The S&P 500 overall has returned only 1.1%, while gold has risen 11.6%.  From the article: “The world’s primary asset measure, the S&P 500, reached all-time … highs in 2013,” said Mike McGlone, head of research at ETF Securities. “When the S&P 500 moved above the old high near 1,550 in March 2013, the gold correction accelerated.”But “to the extent that the S&P 500 does not go up, or corrects, and/or underperforms expectations, gold should remain a primary beneficiary,” he said.

Barclay’s U.S. Bond Index Vs. Gold Coins And Gold Bullion
The Barclay’s Bond Index has returned 1.9% so far this year as compared to the 11.6% rise in gold that is tracked by gold coins and gold bullion. On this topic the author quoted Michael Gayed of Pension Partners, and he had this to say,”Gold and Treasurys have both played off of the same reasons: expectations of a return to negative real rates (inflation greater than nominal rates)”.

iShares Emerging Markets ETF Vs. Gold Coins And Gold Bullion
Emerging markets have taken quite a hit this year; they are down 8%, while gold is up 11.6%. Gold coins and gold bars also do not have to be redeemed where you bought them, gold is liquid worldwide, and it is convertible into any currencies. With a share fund like iShares, only iShares will cash you out. If things don’t go well for them, they may not cash you out, and surprise, since they provide an “investment” service, they are not required to make you whole or ever return any part of your investment in the event that they fail. This is true for the vast majority of investment products, and this is something you should strongly consider when you invest.

Bitcoin Vs. Gold Coins And Gold Bullion
From November 1st of 2013 to the end of the year, Bitcoin prices were up nearly 400%. However, from the beginning of 2014 until now, Bitcoin is down nearly 20%. Bitcoin is a virtual currency that is not backed by any government or company in particular. Bitcoin and gold are similar in these fashions, but that is pretty much where the similarities end. When the Bitcoin exchange, Mt. Gox, failed, millions of dollars worth of Bitcoins went to cyber-money heaven. Gold is not virtual, gold coins and gold bullion products are tangible and physical wealth. To see how gold fared against the rest of these competitors, follow this link.