In a stock market where almost every sector seems to be taking a pounding, the Russell Global Gold fund certainly stands out.
The exchange traded fund (ETF), which tracks the performance of the key gold mining companies, has produced astonishing returns of 120% since late October.
And with analysts predicting that gold could surge to a record high in the coming months, it’s certainly an investment with potential.
A golden opportunity
If you’re unfamiliar with an ETF, it is basically an investment vehicle that allows you to track an index rather than a specific company.
And if there’s one area that has been worth tracking in recent months it is gold.
The precious metal broke through the $1,000 an ounce barrier for the first time in almost a year last week, closing at $1,002 on Friday.
UBS predicts more to come
And UBS strategist John Reade believes there’s more growth to be had yet, making it an interesting investment opportunity.
Speaking to news agency Reuters, Reade said: "We have an average forecast of $1,075 for the first half of this year, which implies we should get to a new high."
"To average that in the first half of the year, you could make a case for gold going up to $1,200, perhaps more.”
Far more attractive than savings
One of the main reasons why so many people are looking to the stock market for returns is the collapse in savings rates.
Whereas 6.3% was widely available last summer, you’re now lucky to get half that, with a quarter of all variable rate accounts paying 0.1% or less.
By contrast, equity markets are priced at the lowest levels for years, providing a great opportunity to improve the long term value of your nest egg.
And best of all you can do it tax-free by making use of a stock market ISA. Of course, the key benefit of a savings account is that your money is guaranteed, while in shares you could end up losing a large chunk of your cash.
Therefore it is a good idea to avoid any high risk investments, especially if you are new to trading.
