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Hamilton Gold Producer YIELD MAXIMIZER TM ETF (AMAX)
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Credit Suisse X-Links Silver Call ETN IOPV (SLVO)
Q: I read with interest your answers to Alex and Robert this morning regarding SLVO and David Rosenberg's thoughts. I have a great deal of respect for Mr. Rosenberg . Does 5i feel that SLVO would roughly track the gold index ? I do not see any covered call gold equivalent ETF unless you know of one ? The closest I can find is AMAX which is gold miners ..... Having said all that which does 5i feel is the better choice to follow Mr Rosenbergs thesis ? SLVO or AMAX ? I do like the covered call component of both over a straight up Gold security like PHYS ..... Thanks for your terrific service .......
5i Research Answer:
SLVO is more likely to follow silver. It will lag in rallys but likely perform a bit better in declines due to its covered call income. There are several gold producer covered call funds, but little choice for physical gold. SVLO is set up well to minimize current taxes while getting a high yield (most return will be return of capital or capital gains). Generally, one uses bullion for 'protection' and stocks for upside potential. Also, silver does have industrial uses, so can be more economic sensitive to gold. If one is bullish on gold, we would prefer AMAX (yield is lower than SLVO, though).