Thursday, 10 May 2012

BlackRock Gold and General: -10% in a week -40% from 2011 peak

The performance of my BlackRock Gold and General fund holdings has been dire.  It is down around 10% this week and nearly 40% since it's peaks in September 2011.

The 25% drop over the last year appears almost reasonable next to these two figures!

Over the year:

 Over the week:
 Effect on my portfolio:

I seem to have put more into it than I meant to because it's a handy consolation purchase. I can drop £250 into it for free on days when I don't have the nerve to buy ETFs with £11.95 transaction fee.

I forget that it's a totally different investment and in terms of my generally small and undiversified portfolio, it has become very significant.

Before even trying to analyse my investment rationale with this fund, its performance begs lots of questions about a view of gold itself as well as how the equity market sits alongside it. These remain unanswered for me.

Today Hargreaves Lansdown published an update on its view of the fund. I noticed they very politely didn't mention how very badly the fund is doing.

This broker's recommendations should be taken with a major pinch of salt when it comes to the major fund managers. Ever since Hargreaves did it's best to sell Anthony Bolton's China Special Situations investment trust to its clients its credibility has gone down with me.

Not that I have anything against Anthony Bolton or his trust - although it has done badly - it's more to do with the fact that it's an investment trust and if, as I suspect most, of its investors followed him from his mutual fund, then they don't know the difference between the trust and the fund. If Bolton leaves the trust their shares will probably plummet in value, a risk they didn't face when he left the fund.

Hargreaves managed to wrangle it so they took a fee for their support of this trust which shouldn't happen on investment trusts anyway!

Some others - like Citywire - still recommend it but haven't up dated it for ages. I'll be hanging on - no doubt looking for arguments like this from Mike Paulenoff at MarketWatch to justify hanging on. I might even put another £250 into it.

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