Trumponomics Divides Investors as Gold ETF Flows Diverge – by Luzi-Ann Javier (Bloomberg News – January 10, 2017)

Gold is splitting the investment community down the middle.

Take the flows into and out of exchange-traded funds. Money has been draining out of SPDR Gold Shares, the world’s largest gold-backed ETF used by big institutional investors, each week since Nov. 11. But iShares Gold Trust, a smaller rival favored by individuals investing lesser amounts for themselves, has seen back-to-back weekly inflows.

Large mutual, pension and hedge funds are chasing better returns in rallying U.S. stock markets thanks to President-elect Donald Trump’s pro-growth policies. Retail investors including iShares Gold holders are returning to gold amid renewed concern that Trump protectionism will restrict global trade and growth.

Those concerns were shared by more than two-thirds of traders surveyed by Bloomberg News last month, who forecast prices will gain this year as political uncertainties drive demand for haven assets including bullion.

Gold futures rose as much as 0.5 percent, before settling little changed Tuesday at $1,185.50 an ounce on the Comex in New York. Prices have risen 5.4 percent since hitting a 10-month low on Dec. 15. People familiar with China’s plans said last week the nation is prepared to retaliate should Trump take punitive measures against Chinese goods and trigger a trade war between the two biggest economies.

Last week, investors pulled $307.1 million from SPDR Gold, while iShares attracted $80.8 million, according to data compiled by Bloomberg.

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