Individual investors are snapping up gold coins big-time, helping to power a strong rally by the precious metal so far this year.
The February Comex gold contract recently traded at $1,735 an ounce, and prices have risen a whopping 11 percent this month.
As for the coins, sales of gold American Eagles — the world's most popular minted bullion coins — have reached 114,500 troy ounces this month, the highest volume in a year, according to the U.S. Mint.
Individuals buying the coins are concerned about inflation, a potential weakening of the dollar, Europe’s debt crisis, and global economic uncertainty, The Wall Street Journal reports.
Interestingly enough individual investors are stepping in where professionals are hesitant.
"There has been somewhat of a disconnect" between retail buyers and the pros, Nick Moore, head of commodity strategy at Royal Bank of Scotland, tells The Journal.
Money managers recently cut their bullish positions in Comex gold futures and options to an almost three-year low, according to The Journal. But individuals "have taken a different tack,” Moore says. “They have seen the good value gold is offering."
One professional who’s optimistic about gold is Rich Ilczyszyn, founder of iitrader.com. He thinks the Federal Reserve’s announcement last week that it expects to keep interest rates near record lows through late 2014 augurs well for gold.
“It’s a green light for gold and other commodities,” Ilczyszyn tells Yahoo.
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