NEW YORK (
let his big bet on gold ride in the fourth quarter, moderately adding to his sizable position in the precious metal as
Paulson, who famously bet correctly that the housing bubble was about to burst in 2008, retained Paulson & Co.'s position as the largest holder of
SPDR Gold Shares
with 31.5 million shares valued at $3.45 billion. Paulson did not add to his position in the fourth quarter, but it remains 17% of the portfolio, the fund's largest position.
SPDR Gold Shares is popular among investors who believe in higher gold prices because the ETF tracks gold's spot price. Mining stocks can have as much as 3 to 1 leverage to prices, but the GLD typically gives an investor more stability without as much leverage.
tripled his gold holdings
in SPDR Gold Shares from 2.5 million shares to 6.2 million shares as gold prices hit an all-time high of $1,227 an ounce. In his most recent form 13F-HR filed with the SEC for the fourth quarter of 2009, Soros reportedly became the fourth largest owner of the SPDR Gold Shares, but still a far cry from Paulson.
Paulson also owns 42 million shares of
, 8.69% of the portfolio. AngloGold is one of the last remaining large-cap miners to have hedges which can limit leverage to rising gold prices.
Paulson did make relatively small additions to gold miners
, adding 550,000 and 719,200 shares, respectively about 2.35% increases. This is compared to a 1,925% increase to his
position and an addition of 200 million shares of
to offset a weakening global market for jewelry. The World Gold Council said investment demand rose 7% in 2009, making it the only subsector to support growth while jewelry demand tumbled 20%. ETF demand was 85% higher than in 2008 due to investors like Paulson and Soros making sizable bets on the precious metal.
Paulson and Soros are just two of a number of big names
, president of Greenlight Capital, has previously said that gold will do well as the currency crisis escalates and that prices will head higher unless Washington executes monetary restraint. Einhorn said in an interview with
The Wall Street Journal
that his hedge fund owns a massive amount of physical gold stored near Times Square. Einhorn also likes mining companies.
Market Vectors Gold Miners ETF
, a basket of large-cap miners, makes up about 5.03% of his portfolio, although his position was unchanged in the fourth quarter.
While big investors like Paulson, Soros, Einhorn and Jim Rogers are bullish on gold in the long-term, there have been some short-term setbacks. Paulson's new gold-focused hedge fund has lost 14% since opening for investors last month, according to
Written by Alix Steel in New York
Alix joined TheStreet.com TV in February 2007. Previously, she held positions in film and theater production, management, and legal administration. Alix has a degree in communications and theater from Northwestern University.