Gold is Paul Tudor Jones’ Favorite Trade Over the Coming 12-24 Months

In a recent Bloomberg interview, legendary trader and hedge fund manager Paul Tudor Jones was asked what areas of the markets currently offer the best opportunities in his opinion. His reply: “As a macro trader I think the best trade is going to be gold”. The relevant excerpt from the interview can be viewed below (in case the embedded video doesn’t work for you, here is a link to the video on Bloomberg).

 

Paul Tudor Jones really likes gold (and treasuries)

 

This is worth mentioning for the simple reason that Paul Tudor Jones has an outstanding track record as a macro trader. His long term annualized return is close to 20%, although the results of his flagship fund were less spectacular in recent years, as he has deliberately adopted a more conservative investment style.

It is obviously not easy to swing for the fences with a hedge fund that has several billions of USD in assets under management. What’s more, many institutional investors these days seem mainly interested in getting small, dependable returns amid low volatility – and Tudor Jones seems to have adapted accordingly. Nevertheless, when he identifies a specific asset class as his favorite trade, it is probably worth paying attention.

For readers not familiar with Paul Tudor Jones, he originally rose to fame for correctly anticipating both the stock market rally of the 1980s and the 1987 crash (here is a documentary on this feat, which is well worth watching). He realized at the time that the 1980s stock market boom looked eerily similar to the 1920s boom. By comparing the two patterns, he was ultimately able to precisely pinpoint the market peak and time the crash. His fund returned 125.9% after fees in 1987. As his long-term returns attest to, this was by no means a fluke – the man definitely knows what he’s doing.

 

Addendum: Speculative Positioning in Gold Futures

As we suspected in our gold update last week (see A Surprise Move in Gold for the details), speculators have added quite a bit of exposure on the long side in gold futures as the recent rally unfolded. However, as you can see from a long-term chart of the net hedger position (the inverse of the net speculative position), there is still quite a bit of room for the net speculative long position to grow – provided a cyclical bull market is indeed getting underway.

 

According to last week’s CoT report the net commercial hedger short position has grown to around 172,000 contracts. In a bull market, this position is likely to become much larger before it poses a problem – the likely target range is indicated by the green rectangle at the bottom of the chart.

 

Chart by: SentimenTrader.com

 

 

 

Emigrate While You Can... Learn More

 


 

 
 

Dear Readers!

You may have noticed that our so-called “semiannual” funding drive, which started sometime in the summer if memory serves, has seamlessly segued into the winter. In fact, the year is almost over! We assure you this is not merely evidence of our chutzpa; rather, it is indicative of the fact that ad income still needs to be supplemented in order to support upkeep of the site. Naturally, the traditional benefits that can be spontaneously triggered by donations to this site remain operative regardless of the season - ranging from a boost to general well-being/happiness (inter alia featuring improved sleep & appetite), children including you in their songs, up to the likely allotment of privileges in the afterlife, etc., etc., but the Christmas season is probably an especially propitious time to cross our palms with silver. A special thank you to all readers who have already chipped in, your generosity is greatly appreciated. Regardless of that, we are honored by everybody's readership and hope we have managed to add a little value to your life.

   

Bitcoin address: 12vB2LeWQNjWh59tyfWw23ySqJ9kTfJifA

   
 

One Response to “Paul Tudor Jones Likes Gold”

  • utopiacowboy:

    Gold briefly hit $1357 today before going in the toilet. These moves based on political developments like Iran or Trump are not sustainable. A rise is in the cards but only over a long term horizon of years if not decades.

Your comment:

You must be logged in to post a comment.

Most read in the last 20 days:

  • Repo Quake – A Primer
      Chaos in Overnight Funding Markets Most of our readers are probably aware that there were recently quite large spikes in repo rates. The events were inter alia chronicled at Zerohedge here and here. The issue is fairly complex, as there are many different drivers at play, but we will try to provide a brief explanation.   There have been two spikes in the overnight general collateral rate – one at the end of 2018, which was a first warning shot, and the one of last week,...
  • Curious Events in Risk-Free Collateral-Land - Precious Metals Supply and Demand
      Liquidity Shortage Last week the price of gold rose $28, and silver $0.53. But the prices of the metals was not the big news last week. The price of repo — a repurchase agreement, to sell and repurchase a treasuries — skyrocketed. Banks were thirsty for liquidity, and only cash can quench it.   Last week's “oops” moment in repo land as the overnight general collateral rate briefly soared to 10% (we will soon publish a detailed summary of the sequence of events that...
  • The Inexorable Final Collapse
      Groping in the Dark This week central planners pursued their primary mission with steadfast conviction. They planned. They prodded. They prearranged tomorrow to save us from ourselves. Some also grubbed a little graft for their trouble. Other central planners took to debasing the dollar to price fix the federal funds rate within a narrow band of tolerance.  What in the world do they think they are doing?   Central planning committee in the analysis and forecasting phase......
  • Elizabeth Warren’s Plans to MAGA
      21st Century Hooverville There are places in Los Angeles where, although the sun always shines, they haven’t seen a ray of light in over 100-years.  There’s a half square mile of urban decay centered on the Union Rescue Mission at 545 South San Pedro Street, where depravity, chaos, addiction, insanity and archaic diseases multiply and ricochet about like metastatic cancer.   One of LA's modern-day Hoovervilles in San Pedro Street...  In 2015 it was reported that Union...
  • The System Scrapes By - Precious Metals Supply and Demand
      An Accident in Waiting The price of gold dropped $20, and silver 43 cents. For reference, $20 was once worth just about an ounce of gold. Dollar was a unit of measure, a weight of gold equal to 1/20.67 ounce of fine gold.   A gold certificate from the time when the dollar still represented a fixed weight of gold [PT]   Today, it is an irredeemable currency, defined not as a unit of weight but as a unit of central bank liability which is backed by government debt,...
  • Zugzwang - Precious Metals Supply and Demand
      Respectable and Not so Respectable Assets The price of gold went up 8 bucks, and the price of silver went up a penny last week. These were not among the capital assets that could be liquidated for greater quantities of consumer goods last week. Nor were equities.   A respectable, mother-in-law-proof speculation: the 10-year US treasury note. [PT]   However, the consumer goods stockpile stored in treasury bonds (to extend our half sarcastic, half tongue-in-cheek...
  • Fed Chair Powell’s Inescapable Contradiction
      Under the Influence   “This feels very sustainable.”  – Federal Reserve Chairman Jerome Powell, October 8, 2019   Understandable confusion... [PT]   Conflict and contradiction.  These were two of the main themes reverberating around the world of centralized monetary planning this week. On Tuesday, for instance, a novel and contradictory central banker parlance – “reserve management purposes” – was birthed into existence by Fed Chair Jay...

Support Acting Man

Austrian Theory and Investment

j9TJzzN

The Review Insider

Archive

Dog Blow

THE GOLD CARTEL: Government Intervention on Gold, the Mega Bubble in Paper and What This Means for Your Future

Realtime Charts

 

Gold in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Gold in EUR:

[Most Recent Quotes from www.kitco.com]

 


 

Silver in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Platinum in USD:

[Most Recent Quotes from www.kitco.com]

 


 

USD - Index:

[Most Recent USD from www.kitco.com]

 

Mish Talk

 
Buy Silver Now!
 
Buy Gold Now!