Kinsman Oak Capital Partners, an investment management firm, published its “Kinsman Oak Equity Fund” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 3.7% was delivered by the fund for the Q1 of 2021, trailing the S&P 500 Index that delivered a 6.2% return for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Kinsman Oak Equity Fund, in its Q1 2021 investor letter, mentioned SPDR Gold Shares (NYSE: GLD), and shared their insights on the company. SPDR Gold Shares is a US-based SPDR family of exchange-traded funds that currently has a $57.7 billion market capitalization. As of May 14, 2021, the stock closed at $172.69 per share.
Here is what Kinsman Oak Equity Fund has to say about SPDR Gold Shares in its Q1 2021 investor letter:
“SPDR Gold Trust (GLD) – Closed Long Position
We initiated a position in GLD last summer to hedge against potential currency debasement. Our long-term thesis hasn’t changed much since then. The United States continues to run enormous fiscal deficits and we believe the Fed will eventually have to choose between the dollar and the stock market.
We chose to close our GLD position for two reasons. First, gold is inversely correlated to real yields in the short run and behaves like a long duration asset in that regard (Appendix E). The precious metal is correlated to M2 money supply growth only over long periods of time. Second, we are exploring more asymmetric and creative ways to profit from debasement rather than owning the physical metal.”
Our calculations show that SPDR Gold Shares (NYSE: GLD) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, SPDR Gold Shares was in 62 hedge fund portfolios, compared to 65 funds in the third quarter.
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