The best way to profit from gold

Article Excerpt

Gold prices have moved down from their peak of $1,918 an ounce in August 2011 to today’s price of $1,595. Gold could move higher in the long term, but it will remain volatile. In addition, a deeper drop is by no means out of the question. We continue to recommend that you focus your gold investing on gold-mining stocks and avoid buying gold bullion, gold coins (unless you collect them as a hobby) or certificates representing an interest in bullion. That’s because these investments have hidden costs, such as insurance and storage, that dramatically cut their value over time. Newmont remains our top choice among gold stocks. Most of its production comes from politically stable areas, such as North America and Australia. As well, its new dividend policy gives investors an opportunity to automatically profit when gold prices rise. NEWMONT MINING CORP. $61 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 494.8 million; Market cap: $30.2 billion; Price-to-sales ratio: 3.3;…