Today’s recommendation is a closed-ended commodity mutual fund that invests in silver and gold.
Central Fund of Canada (CEF)
from The Aden Forecast
Gold and silver shares are forming the “right shoulder” of a bottom area and they’re holding well above the December lows. This is good action in a bombed out sector.
We know gold shares are clearly out of favor, but we think it’s a good time to be picking up some good value, selectively and patiently. Gold shares continue to also bottom versus gold, and the juniors continue to bottom versus the seniors. All this is a plus for a clearly oversold market.
Most interesting now is Central Fund of Canada (CEF). We’ve been buying and holding CEF for 10 years. It’s a great way to hold gold and silver in a Canadian bank vault. It’s roughly a 60-40 weight and you have the best of both.
We’ve also mentioned in the past that U.S. citizens pay the normal capital gains tax on it instead of the 28% you pay to hold gold. This fund is solid and it normally has a premium on it, especially during the bull market. But now with gold out of favor, the premium has turned into a discount. This makes CEF exceptionally attractive to buy now.
Mary Anne & Pamela Aden, The Aden Forecast, www.adenforecast.com, 305-395-6141, May 2014