This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Why Gold Will Maintain Its Luster

Another factor likely to provide strong support to gold prices is the expected increase in demand derived from a growing middle class in developing nations. In general, as middle classes grow and incomes rise, these consumers demand and spend more on the finer things in life, like jewelry. With middle classes in nations like China, India and Brazil growing at an exponential rate, the demand for gold used in jewelry in these nations is likely to spike.

Lastly, as the economy in the U.S. rebounds, inflation will likely be inevitable, further bolstering gold's appeal.

Three ETFs that will likely reap the benefits of an appreciation in gold prices include:

The SPDR Gold Trust (GLD), which actually holds physical gold bullion and closed at $111.37 on Friday.

The Market Vectors Gold Miners ETF (GDX), which holds various companies that generate revenue through gold mining, exploration and other gold related services, like Barrick Gold (ABX - Get Report), and Goldcorp (GG - Get Report). GDX closed at $49.84 on Friday.

The PowerShares DB Gold (DGL), which tracks gold futures contracts and close at $40.74 on Friday.

Whenin vesting in these equities, it is important to consider factors that could potentially hinder the price of gold, like an earlier than expected tightening of U.S. monetary policy by the Fed. A good to way to protect against these factors as well as the inherent risks involved with investing in equities is through the use and implementation of an exit strategy, which triggers price points at which an upward trend in gold could potentially be coming to an end.

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
ABX $11.29 0.00%
DGL $39.60 0.00%
GLD $115.06 0.00%
GDX $18.84 0.00%
GG $18.43 0.00%


DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs