Best Stocks Picks For 2011 – Q1 Update

Time for the first quarter stock picking contest update.  As usual, I’m in last place.  Yay me!  I shorted gold, which I know will be a brilliant pick eventually – I just don’t know when.  🙂

My specific pick was to short the gold ETF CGL.

What is CGL you ask? It is the Claymore Gold Bullion ETF which trades on the TSX. What does it invest in? Gold – literally. The ETF currently own 14 pounds of the stuff, so it really is a direct play on gold. By shorting it, I will be sending a message to all those crazy gold bugs, that their fun and games are about to end.

Rank Site YTD Return (%)
1 The Financial Blogger 12.41
2 Million Dollar Journey 12.16
3 My Traders Journal 11.77
4 Where Does All My Money Go 5.13
5 Beating The Index 3.08
6 Intelligent Speculator 1.66
7 Dividend Growth Investor 1.43
8 The Wild Investor 0.28
9 Money Smarts -1.17

4 replies on “Best Stocks Picks For 2011 – Q1 Update”

Mike, your message to the gold chasers has not been very well received. I think they’re still too busy listening to Glen Beck and Dollars for Gold commercials.

I don’t know who amazes me more, the people that buy into crazy hype and create these bubbles, or the “experts” that claim to know the market and yet still believe that rational/logical forces govern peoples’ decisions! Clearly there are a lot of idiots out there that are still buying into gold and sustaining this insane valuation. My guess is they will get into stocks right around the peak and then complain when they sell off after a crash. This will further their conviction that gold is the only ‘true store of wealth.’ Stay on the bandwagon Mike, the bubble might burst next year when it’s too late for your contest, but it most assuredly will burst.

The funny, and scary, thing about gold is that it is always impossible determine whether it is under or over-valued. It produces no income. 90% of the gold bought and sold is between people who never plan to use it for anything. Investors who have no use for it will buy it because they believe other investors who have no use for it will buy it from them in the future at a higher price. It is the easiest commodity on earth to do without and there is no objective way of determining its fundamental value. For those reasons, there is neither a ceiling nor a floor on what the price could be. I agree that there will be a major crash in the price of gold, but it is very difficult to determine when. and at what peak price, it will happen. I suspect it will be increasing global interest rates will eventually trigger the sell-off. It will be very interesting to see what happens to some of these gold bullion ETFs in the case of a gold crash.

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