George Soros, a billionaire investor, has cut his investment in U.S stock by 37percent as at the end of the first quarter and instead bought $264 million stakes in world biggest bullion producers. According to the government filing, Soros bought 1.7 million shares in Barrick Gold Corp and 1.05 million shares in SPDR Gold Trust.
Soros has built his $24 billion fortune by speculating markets performance. Earlier this year he publically warned against risk stemming from China economic slump. He argued, a hard landing in China economy was practically impossible on http://www.valuewalk.com/2016/05/george-soros-gold/, and its debt-fueled economy resembles 2008 global crises. He added that such slump would worsen global deflationary pressures, create a global recession, and drag down the stocks.
13F filings reveal that Soros has sold $173 million worth stakes in Level 3 Communications Inc and $163 million worth stake in Dow Chemical Co. Further, the filing reveals that his family office has divested its stakes in Delta Air Lines Inc and Endo International Plc. George Soros is not alone, regarding economic slowdown. Glenview Capital Management, a hedge fund headed by Larry Robbins has also cut its investments of U.s stock by 22 percent to $13.6 billion.
Since mid-2011, the gold price decreased by more than 40 percent. Currently, the price hovers around $1,118 per ounce. This is a dangerously low price for gold miners. Small miners will be wiped out due to a price slump. Later, supply contractions will spark resurgence in the gold price. Top investors are aware of this trend.
Stan Druckenmiller, another billionaire investor, is also reading from the same page with Soros. Recently, he said that gold is his largest currency allocations. Other investors are moving in the same direction, and this can be inferred from 16 percent jump in gold for immediate delivery in the first three months this year. According to Bloomberg at http://www.bloomberg.com/news/articles/2016-05-16/billionaire-soros-cuts-u-s-stocks-by-37-buys-gold-producer, generic pricing this is the largest quarterly surge since 1986.
In the face of endless money, printing by Federal Reserve gold price dropped significantly, and it is also likely to inflate stock markets. Soros is cleverly hedging against an economic slowdown by holding steady bet that the price of gold will rise again.
In financial markets, George Soros can be referred as a mythical figure. He spent his childhood escaping from Nazi Germany. Soros landed in London where he studied philosophy under Karl Popper. After he had finished his Ph.D. thesis at London School of Economics, Soros found his way to finance market where he has created a monument of legendary investment career.
George Soros gained international notoriety in 1992, after his $10 billion betting against England pound. His speculation was perfectly right and in single day trade, he made a profit of $1 billion. At the end of the transactions, he had made a profit of more than $2 billion. Since then he is famously known as “The Man, Who Broke the Bank of England”.