George Soros and Eric Mindich cut their holdings in the SPDR Gold Trust in the second quarter as prices rallied to a record, while billionaire John Paulson maintained the largest stake, according to fund records.
Soros Fund Management LLC held 42,800 shares in the biggest exchange-traded product backed by gold as of June 30, compared with 49,400 at the end of the first quarter, a filing with the U.S. Securities and Exchange Commission showed yesterday. Mindich’s Eton Park Capital Management LP cut its stake to 813,000 shares from 2.328 million, a separate filing showed, while Paulson & Co. kept its 31.5 million shares.
Gold is set for an 11th year of gains as Europe’s sovereign-debt crisis and concern that the U.S. economy may be slowing spur demand for a haven. Money managers who oversee more than $100 million in equities must file a Form 13F with the SEC within 45 days of each quarter’s end showing U.S.-listed stocks, options and convertible bonds, offering insights into how some of the world’s biggest investors are positioned.
“The current low-interest-rate environment and the weakening dollar will continue to enhance the appeal of gold,” said Ong Yi Ling, an investment analyst at Singapore-based Phillip Futures Pte. While some investors were concerned about the pace of rally, prices are likely to reach $2,000 an ounce in the next 12 months, she said by phone.
Bullion for immediate delivery, which reached a record $1,814.95 an ounce on Aug. 11, was up 0.6 percent at $1,776.60 by 12:33 p.m. in London. The precious metal, which ended the second quarter at $1,500.35, has rallied 25 percent this year, compared with the 4.2 percent drop by the Standard & Poor’s 500 Index. Treasuries returned 6.5 percent in 2011, a Bank of America Merrill Lynch index showed.
Investors in gold-backed ETPs owned about 2,186 metric tons of the metal as of yesterday, more than all except four central banks hold, according to Bloomberg calculations. The amount of gold tied to ETPs -- which trade on exchanges, with each share representing metal held in a vault -- surged to record 2,217 tons last week.
Steven A. Cohen’s SAC Capital Advisors LP, which manages about $14 billion, and Eton Park placed bets on rising prices during the second quarter, their SEC 13F filings show.
Stamford, Connecticut-based SAC Capital held 4.3 million call options linked to the SPDR Gold Trust valued at $627.7 million as of June 30, according to its filing. There was no record of any SPDR Gold shares or options in the billionaire’s portfolio in the first quarter, another filing showed. Mindich added 2.702 million call options on SPDR Gold shares during the latest quarter, taking the total options position to 8.702 million.
At the end of the fourth quarter, Soros owned 4.72 million shares of SPDR Gold and sold most of his holdings in the three months to March 31. In January last year, the 81-year-old described the precious metal as “the ultimate asset bubble.”
The metal has also risen to records in euros and pounds as Europe’s debt woes boosted demand for a protection of wealth and Standard & Poor’s cut its U.S. credit rating. The Federal Reserve has kept borrowing costs near zero since December 2008.
A lot of gold “is currently held by physical investors, whose positions tend to be stickier than those of speculators,” Edel Tully, a London-based analyst at UBS AG, wrote today in a report. “The investment demand that pushed gold to fresh highs was safe-haven buying inspired by macroeconomic uncertainty which is unlikely to disappear anytime soon.”
Paulson’s SPDR Gold holdings comprised almost 16 percent of the firm’s total portfolio, and their value has soared about 62 percent since he bought the shares in 2009.
Paulson trimmed his stake in Johannesburg-based AngloGold Ashanti Ltd. by selling 1.1 million American depositary receipts, holding 39.9 million at the end of the quarter. The company remained the hedge fund’s biggest investment after the SPDR Gold Trust. Paulson sold his stake in Canadian miner Kinross Gold Corp.
Michael Vachon, a spokesman for Soros, didn’t respond to a voicemail or answer the phone after calls from Bloomberg outside normal business hours. Armel Leslie, a spokesman for New York-based Paulson, declined to comment on the filing.
Mindich of Eton Park declined to comment. Jonathan Gasthalter, a spokesman for SAC, didn’t immediately respond to a voicemail left by Bloomberg outside normal business hours.