Gold News

Gold Price Uptrend "Should Continue for Some Years"

THE HEAD of a major investment fund expects to see the current uptrend in the Gold Price continue for a number of years.

Evy Hambro, portfolio manager of the $17 billion BlackRock World Mining Fund, said in an interview with Bloomberg Television Tuesday that analysis by his firm suggests the Gold Price should continue to reach new highs.

"When you look at the underlying fundamentals in gold, they're all very supportive of today's pricing points and of pricing points higher than where we're trading right now," he said. "So we would expect to see this positive, gradually rising price trend in gold to continue for some years into the future. I think some of the uncertainty that exists around exchange rates, quantitative easing, what paper money will buy you in the future, all of that is only helping gold from a financial point of view."

Hambro added that in his view the best way to get exposure to the Gold Price was through a mixture of physical exposure and Gold Mining equities.

Figures published by the World Gold Council (WGC) for fourth quarter 2010 show that Gold Investment demand – which includes demand for physical Gold Bars and coins as well as investment through ETFs – grew 13% year-on-year. 

However, Gold Investment worldwide accounts for only 0.7% of global asset allocations, WGC estimates.

John Hathaway, manager of the Tocqueville Gold Fund, has estimated that in 1935 the market value of above ground gold reached 15% of US financial assets, while in 1980 – the year the Gold Price hit its inflation-adjusted all time high – it hit as high as 29%.

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