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Wednesday, 11th October 2006 (6094 views)

Gold is not simply a "buy and hold investment", claims a leading fund manager.

Trevor Steel, managing partner of Baker Steel Capital Managers, says investing in gold required much more of an "analytic" approach, especially within a hedge fund situation, reports the Asian Investor website.

Speaking at a three-day gold and precious metals investment conference in Hong Kong, Mr Steel added: "We seek ideally a valuation anomaly together with a catalyst."

Baker Steel, which oversees $600 million in commodity assets, currently offers two metals-oriented funds.

One offers gold price market neutral investing in gold mining companies, while the second, launched in 2003, serves as a long-term gold investment fund.

Investing only in commodities is a "rollercoaster ride", Mr Steel said, adding that this is something many investors feel they can't handle.

In addition, Mr Steel explained that catalysts were a vital part of gold investment and that mining accidents and new finds could have a dramatic impact on hedge fund values.

 

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