85.79 +0.07 (+0.08%) Buy

GOLD continues to mint money for it's investors

13 min read

RANDGOLD RESOURCES LTD (Foreign) ranked among the best performers on Monday. It delivered +0.08% to close at 85.79. On a day when the overall market breadth was 34%, it closed higher than 69% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing GOLD]

GOLD showed a strong bullish trend over the last 3 months. During this period GOLD delivered +37.46% and saw a maximum drawdown of -6.49%. There was a long signal during this period which returned +25.9%.


GOLD has been outperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 6 Jul, 2016 to 14 Sep, 2018. Over the last 2 years 11 months and 10 days, GOLD outperformed the SP500 index on 50% days. Which indicates that on days GOLD outperforms the SP500 index, it's performance is marginally better than on the days it underperforms the SP500 index.

During the last three months GOLD was mostly profitable and delivered on average +0.53% per day. It's best return during this period (of +9.48%) was on Thursday, 11 Oct, 2018. While it's worst loss in the same period (of -4.09%) was on Thursday, 25 Oct, 2018. The longest stort-term trends during this period were 5 profitable and losing days. The bullish trend (which returned +5.86%) started on 15 Oct, 2018 and went on till 19 Oct, 2018 while the bearish trend (which returned -2.85%) started on 3 Oct, 2018 and went on till 9 Oct, 2018.

During the last year GOLD had 6 profitable months and 6 loss making months. GOLD returned profits in fewer months than SP500 index. GOLD was also a more risky investment than SP500 index as it's worst month in the last year, Feb 2018, returned -19.91% compared to -7.28% returned by SP500 index in Oct 2018. GOLD had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Apr 2018 to Aug 2018) during which period it delivered -23.3%.

The stock market clearly values companies that can deliver disruptive innovation.
-- Steve Blank

GOLD is currently seeing overall fall in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in GOLD's volatility from 18 Sep, 2018 to 11 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 25 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that GOLD has significant negative skewness in it's return distribution. This indicates that GOLD is very risky for short-term investment and can significantly underperform for long durations.

GOLD has more chance of extreme outcomes than the SP500 index. Therefore, GOLD must receive a lower allocation than SP500 in your portfolio. SP500 index usually has shorter drawdown period than GOLD.

On a general note (since you are interested in GOLD), three mid cap instruments that deserve special mention are AMD, RHT and ABMD. They have all outperformed the market and must be closely watched for investment opportunities.

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