Paper vs Physical Gold During Coronavirus Pandemic

Discussion of the Gold portion of the Permanent Portfolio

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stuper1
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Paper vs Physical Gold During Coronavirus Pandemic

Post by stuper1 » Mon Mar 16, 2020 12:22 pm

Is anybody checking to see whether paper gold prices are tracking with physical gold prices during this coronavirus pandemic? I'm guessing there's a fairly simple way to do that, but I"m pretty busy right now. Does anybody have that figured out already?
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Tortoise
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Re: Paper vs Physical Gold During Coronavirus Pandemic

Post by Tortoise » Mon Mar 16, 2020 12:58 pm

On my iPhone stock app, I track the tickers GC=F (COMEX gold futures) and GLD side-by-side.

Intra-day they usually seem to track each other reasonably closely, but this past week during the panic I noticed that sometimes one would be up when the other was down.

I had never seen that before, and I assume it has something to do with the short-term market prediction inherent in GC=F. But I don’t know a lot about GC=F, so who knows.
pmward
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Re: Paper vs Physical Gold During Coronavirus Pandemic

Post by pmward » Mon Mar 16, 2020 1:29 pm

ETF spreads also get a bit out of whack when volatility gets crazy like this. The people that normally perform arbitrage on these markets start getting more cautious, as it becomes really easy for them to lose money on an arb trade.
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