The markets were given a sad reminder this week, with the assassination of former Pakistani Prime Minister Benazir Bhutto, that we still live in a dangerous world.

Events like these tend to spark a flight toward investments viewed as as safe havens, such as gold and other precious metals.

When this second attempt on her life in just two months time proved successful, the hope for a return to democracy in Pakistan was dashed.

Bhutto's death showed the other potential candidates that it is not safe to campaign. If President Pervez Musharraf goes ahead with the planned Jan. 8 elections in the absence of viable opposition, the vote would be a sham. If he suspends the elections, that might mean a return to martial law. Either way, that nuclear-armed nation is not close to becoming a stable democracy.

Countries around the world condemned the killing. Plus, the United Nations Security Council issued a statement that "terrorism in all its forms and manifestations constitutes one of the most serious threats to international peace and security." Investors know that peace, security and stability provide the base upon which prosperity is built.

Closer to home, a weaker greenback also boosted the price of dollar-denominated assets such as precious metals. After trending higher since late November, the greenback reversed course on higher-than-expected core inflation for November of 2.2% over last year. The weekly report of rising initial jobless claims of 349 thousand and continuing claims of 2.713 million confirmed the economic softness.

Rising precious metals prices mean that mining companies can sell their gold and platinum at widening profit margins.

The average precious-metals fund we track climbed 6.20% for the week ending Thursday, Dec. 27.

The top-performing fund this week is ( ASA) ASA Ltd. (ASA), a closed-end fund that gained 8.75% for the period under review. As of Aug. 31, the fund invested 10.3% of its assets in Anglo Platinum ( AGPPY), the world's largest platinum producer, and 7.6% of assets in Impala Platinum Holdings ( IMPUY), the second-largest producer.

In second place, the ( FKRCX) Franklin Gold and Precious Metals Fund (FKRCX) did nearly as well, returning 8.38%. This more than covered the 5.75% front load charged to investors.

The fund also benefited from the 14.86% rise in Anglo Platinum Ltd and the 17.0% jump in Impala Platinum Holdings Ltd. These, along with Newcrest Mining ( NCMGY), Barrick Gold ( ABX) and Goldcorp ( GG), round out its top five portfolio positions.

This week the price of platinum set a new record high of $1,545.75 per Troy ounce.

Best Performing Precious Metals Funds
Ranked by return for the week ending Dec. 27, 2007
Fund Ticker Rating Fund Type 1 Week Total Return
ASA Ltd ASA C+ Closed-End 8.75%
Franklin Gold and Precious Metals Fund FKRCX C Open-End 8.38%
ProFunds Precious Metals UltraSector ProFund PMPIX D Open-End 8.13%
Van Eck International Investors Gold Fund INIVX D+ Open-End 7.94%
DWS Gold & Precious Metals Fund SCGDX D+ Open-End 7.78%
USAA Precious Metals and Minerals Fund USAGX C Open-End 7.78%
Market Vectors Gold Miners ETF GDX B ETF 7.63%
US Global Investors World Precious Minerals Fund UNWPX C Open-End 7.57%
GAMCO Gold Fund Inc GOLDX D+ Open-End 7.29%
American Century Global Gold Fund BGEIX C- Open-End 7.26%
Source: TheStreet.com Ratings

For an explanation of our ratings, click here.

( GGN) The Gabelli Global Natural Resources & Income Trust (GGN) lagged all other precious-metals funds. It rose just 2.53%, including a 25-cent special cash dividend, even though the value of its net assets rose 4.95%.

This closed-end fund's discount to net asset value widened to 4.54% from 1.42% at the beginning of the period. The fund diversifies its 62.7% concentration of mining shares with 34.0% oil and gas and 2.1% coal, but clearly investors were favoring pure plays in precious metals this week.**


Worst Performing Precious Metals Funds
Ranked by returns for the week ending Dec. 27, 2007
Fund Ticker Rating Fund Type 1 Week Total Return
Gabelli Global Gold Natural Res & Inc Trust GGN A Closed-End 2.53%
SPDR S&P Metals & Mining ETF XME B ETF 3.04%
iShares Silver Trust SLV C- ETF 3.09%
PowerShares DB Gold Fund DGL U ETF 3.51%
iShares COMEX Gold Trust IAU A ETF 3.59%
Streettracks Gold Trust GLD A- ETF 3.67%
ING Global Natural Resources Fund LEXMX C Open-End 3.86%
Vanguard Precious Metals and Mining Fund VGPMX C+ Open-End 4.09%
RiverSource Precious Metals and Mining Fund INPMX D+ Open-End 5.66%
First Eagle Gold Fund SGGDX D+ Open-End 5.96%
Source: TheStreet.com Ratings

For an explanation of our ratings, click here.

Have a happy and safe new year!

Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.