UPDATE 1-Jana returned to gold for 1st time in a year as prices surged

Mon May 16, 2016 11:41am EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article
[-] Text [+]

(Adds detail throughout, CI Investments filing)

May 16 (Reuters) - Jana Partners LLC returned to gold in the first quarter for the first time in a year, a filing showed on Monday, the latest fund to pile back into bullion as expectations for U.S. interest rate hikes waned, spurring the biggest rally in nearly three decades.

Barry Rosenstein-led Jana Partners bought 50,000 shares, worth about $5.9 million, in SPDR Gold Trust, the world's biggest gold exchanged-traded fund (ETF), the U.S. Securities and Exchange Commission filing said.

The fund dissolved its stake in the gold ETF at the end of December 2014 and exited their gold equity shareholdings in the second quarter last year.

The news comes as CI Investments Inc, an investment manager of Toronto-based CI Financial Corp, almost quadrupled their stake in the ETF, becoming the sixth-largest shareholder, a May 6 filing showed.

The fund bought 2.81 million shares, taking its stake to 3.75 million shares worth $441 million. It also bought 1.5 million shares in Barrick Gold, 2.9 million shares in GoldCorp Inc and 575,000 shares in Market Vectors Gold Miners ETF.

The buying by some of the largest gold investors highlights how funds rushed back into bullion ETFs, which are backed by physical gold, as expectations that the U.S. Federal Reserve would continue to raise interest rates faded.

Volatile equity markets and negative rates in some countries have also boosted demand for a store of wealth.

In the first quarter, spot prices rallied 16 percent for their best quarterly performance in nearly three decades and hit their highest level in a year.

Institutional and retail buying has propelled prices to fresh one-year highs of $1,303 an ounce this month. (Reporting by Devika Krishna Kumar and Marcy Nicholson in New York; writing by Josephine Mason; Editing by Nick Zieminski and Meredith Mazzilli)