UPDATE 1-Paulson holds onto gold ETF, Soros adds gold miners in Q1

Thu May 15, 2014 6:50pm EDT
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(Adds details throughout, including Soros, PIMCO performance))

By Frank Tang

NEW YORK May 15 (Reuters) - Hedge fund Paulson & Co in Q1 maintained its stake in SPDR Gold Trust, the world's biggest gold-backed exchange-traded fund as bullion prices rebounded from their biggest annual loss in 32 years in 2013, while PIMCO dissolved its gold ETF investment.

George Soros raised his stake in Barrick Gold Corp and gold mining companies ETFs, suggesting the big names in hedge funds took advantage of lower gold prices to increase positions in the precious metal used by many as a hedge.

Investors pay close attention to the quarterly filings by Paulson and other notable hedge fund managers because they provide the best insight into whether the so-called "smart money" has lost faith in gold as a hedge against inflation and economic uncertainty.

"Some institutions are stepping up to buy gold this year just like you would expect them to do when they find an asset valued at these attractive levels," said Adam Sarhan, CEO of New York-based Sarhan Capital.

Paulson & Co, led by longtime gold bull John Paulson, owned 10.2 million shares in the ETF worth $1.27 billion on March 31, unchanged from its holdings on Dec. 31, a filing with the U.S. Securities and Exchange Commission showed on Friday.

That represents a gain of around $76 million as the price of gold gained 6.5 percent in the first quarter, following a drop of around 9 percent in the fourth quarter.

This marks the third consecutive quarter Paulson has stuck to his stake in the gold ETF.   Continued...