it's ground hog day ..., page-6

The following is a very interesting comment:

"Dan,

You seem surprised by "the lackluster performance of many of the gold shares as evidenced by the HUI and XAU.".
What surprises me is the fact that you are surprised!

I own gold equities and some of them since 2006 and as many investors I am very disappointed by the gold equities performance. I did forecast the rise in the POG but wanted to leverage my investments by playing mainly the shares.

This is what WE get:

Index 5 Y 3Y Today
HUI 321 514 544
XAU 159 206 206
TSX Gold 350 375 380
POG 720 880 1510

I would add that almost ALL the mutual funds precious metals are under water - so much for the "experts" taking fees for their deep knowledge...

Many investors in gold equities are wondering what is going on. Your explanation (or maybe it is Jim) is/was hedgies are playing gold vs gold equities. Could you elaborate and explain why we should stay invested in gold equities. Thank you for your reply."

At http://traderdannorcini.blogspot.com/2011/05/gold-4-hour-chart-update_09.html

My comments:

This shows just how undervalued gold equities currently are. Three years ago when gold was US$880 the HUI was 514. Today with a US$630 increase in the price of gold the HUI is only 544.

Over the last three years American investors have seen the price of gold rise over 70% in their currency while their own American gold shares have risen a token 6.6%.

Absolutely staggering!!

Surely with such negative sentiment towards gold equities while at the same time we have a strong gold price we are more than due for a massive rise in gold shares.

The more people say, "It won't happen. This time it's different," the more likely it will happen - and with them either not invested or heavily under invested in gold equities imo.