posted on Apr, 30 2012 @ 07:57 AM
In terms of price, an ounce of Gold
is an ounce of Gold
...paper or physical.
The US dollar price of physical Gold (spot price) is determined by the front month
trading in the futures market. At any given moment, 100 ounces of physical bullion stored in a hole in the ground, is equal in value to a 100 ounce GC
contract trading on the Comex. This also holds true for allocated accounts, pool accounts, and certificate programs. As the front month price of Gold
fluctuates on the futures exchange, the value of your investment follows suit regardless of it's form.
Now the wisdom
of 'owning' Gold in paper form is a whole other issue. I would even extend this caution to buying futures contracts with the
ultimate goal of taking delivery; ask Gerald Celente
Personally I adhere to the idiom: If you can't hold it in your grubby little hands, you don't own it
. But the BOA analyst was merely
speculating on blow-off top scenarios priced in USD; he wasn't writing a treatise on Physical v Paper and counterparty risk.
edit on 30-4-2012
by OBE1 because: (no reason given)