By Devika Krishna Kumar and Marcy Nicholson
May 16 (Reuters) - Billionaire financier George Soros and
other big investors have returned to gold for the first time in
years, U.S. Securities and Exchange Commission filings showed on
Monday, a move which spurred a rally to 12 month highs.
Institutional and retail buying has propelled prices XAU=
to fresh one-year highs of $1,303 an ounce this month.
In the first quarter, Soros, who once called gold "the
ultimate bubble," returned to gold after three years, with 1.05
million shares in SPDR Gold Trust GLD (NYSE:GLD).P , the world's biggest
gold exchanged-traded fund (ETF), valued at about $123.5
million.
Soros Fund Management LLC had sold its stake of almost
531,000 shares worth $82 million in the fund in the first
quarter of 2013.
Others have followed Soros back into gold, although on a
smaller scale, including Jana Partners, led by activist investor
Barry Rosenstein, which bought 50,000 shares, worth about $5.9
million
Monday's 13F filings come after CI Investments Inc
CIXCI.UL , an investment manager of Toronto-based CI Financial
Corp CIX.TO , almost quadrupled its stake in the ETF, becoming
the sixth-largest shareholder, a May 6 filing showed.
"We believe this is the start of a change in trend as
momentum following funds are likely to start buying gold due to
the 20 percent price gain and improved technical position," said
Mark O'Byrne, research director of bullion dealer GoldCore in
Dublin.
The buying by some of the largest gold investors has come as
expectations that the U.S. Federal Reserve would continue to
raise interest rates this year has faded.
Gold fell out of favor with investors in 2013 when the Fed
indicated it would start raising interest rates for the first
time in a decade.
In December last year the Fed raised rates for the first
time since 2006 and the price of spot gold XAU= fell to the
lowest level in nearly six years at $1,045.85 per ounce.
SOARING PRICES
In the first quarter this year though, spot gold prices
XAU= rallied 16 percent for their best quarterly performance
in nearly three decades and hit their highest level in a year.
Funds have also increased exposure to gold company stocks.
The Soros fund returned to invest in Barrick Gold Corp ABX.TO
after unwinding its stake in the company in the third quarter of
last year.
It bought nearly 19.4 million shares in Barrick Gold at a
value of $263.7 million, the filing showed. CI Investments
bought 1.5 million shares in Barrick Gold and 2.9 million shares
in GoldCorp Inc G.TO .