Short Gold ETF

A short gold ETF could be just the right tool for you if you think the gold price has ran too far too fast and is due for a pullback, or if you think the gold price is a bubble, ready to pop.  Being easy to enter and to exit, with the tradeability of a stock, these bearish gold ETFs can let you play gold on the short side.

Gold prices may rally for a month, a season, or a decade but at some point in the future the price of gold will fall. Nobody can see the future. Knowing what tools exist can make you a better more prepared (and hopefully richer) investor. Let’s take a closer look at the short gold ETFs (and short gold ETNs) that trade on prominent exchanges:

ETFS Short Gold ETF – This bearish ETF trades on the London Stock Exchange under the ticker symbol SBUL. It is designed to change daily by the inverse of the daily percentage change in the DJ-AIG Gold Sub-Index.

PowerShares DB Gold Short ETN – This ETN trades on the New York Stock Exchange under the ticker symbol DGZ, and is designed to provide the inverse of the gold price.

PowerShares DB Gold Double Short ETN – First cousin to the DGZ, this ETN trades under the ticker symbol DZZ on the New York Stock Exchange. This ETN is leveraged to provide twice the inverse of the gold price.

ProShares UltraShort Gold ETF – Under the ticker symbol GLL, this ETF trades on the New York Stock Exchange and is also designed to trade at twice the inverse of the gold price.

Short gold ETFs can be a powerful tool in your portfolio and can, at times, be an incredibly lucrative trade. However, before you invest in them educate yourself. Read the prospectus of the ETF you are considering and understand how they work, and any risks they may have.