Buy Gold & Silver at a 10.6% Discount

CEF and GTU are ETFs backed by physical metal. CEF is comprised of Gold and Silver (slightly more Gold) while GTU holds Gold. Tracking the price of each relative to its net asset value provides us a useful sentiment indicator. This data is available on stockcharts.com.

In the chart below we plot the price of CEF, its historical premium/discount to NAV and GTU’s historical premium/discount to NAV.

Each security is currently trading at nearly an 11% discount to its NAV. For CEF, that is the largest discount in 12 and a half years. GTU began trading in late 2005 so it does not have as long of a history. Today’s discount of 10.6% to NAV would be the highest discount if not for a single data point in 2006.