As gold's tumble continues, traders bet the pain may last for two more years
Selling in the precious metal just keeps getting worse, with the GLD ETF now down 25% from its intraday record in February.
TL;DR
- The GLD ETF is down 25% from its February intraday record, with recent options trading showing a strong bearish sentiment.
- Traders are buying put options on GLD, with some bets placed on significant price declines over the next two years.
- Factors contributing to gold's drop include sales by Turkey's central bank and gulf nations, and increased duties in India.
- Options trading in gold miners (GDX) is more optimistic, with calls outpacing puts.
- Gold miners may represent better value compared to gold itself, especially if their production costs are significantly lower than current or future gold prices.