The S&P 500 Probably Won't Crash By 50%, But If It Does, Gold Won't Protect You--Here's What Will.
Portfolio Pulse from David Pinsen
The article discusses the improbability of a 50% crash in the S&P 500 market, countering the notion with insights from market technician Chris Vermeulen, who predicts a possible 10% to 20% correction by year-end. It also debunks the idea that gold or gold miners, like Orla Mining Ltd. (ORLA) and the SPDR Gold Shares ETF (GLD), would protect investors in such a crash, suggesting instead that put options on stocks are a more effective hedge. The article highlights the success of a hedged portfolio method, which has shown promising results in protecting against market downturns.
April 11, 2024 | 10:28 am
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SPDR Gold Shares ETF (GLD) is mentioned as having risen 12.78% YTD, but the article argues it would not offer protection in a market crash, aligning with the view that gold's traditional role as a safe haven may be ineffective in certain crash scenarios.
GLD's increase is noted, but the article challenges the effectiveness of gold and gold-related assets like GLD as hedges in a market downturn, suggesting a potential negative short-term impact on GLD's price.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
Orla Mining Ltd. (ORLA) is mentioned as an example of a gold miner that has seen a 25.23% YTD increase, but the article suggests it would not protect investors in a market crash scenario.
Despite its YTD gains, the article suggests that in a deflationary market crash scenario, gold and gold miners like ORLA would not serve as effective hedges, potentially leading to a negative short-term impact on ORLA's stock price.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70