The Learn About Futures Insider for July 28, 2011: Gold

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Like no other metal on earth, gold has captured the imaginations and emotions of humans across centuries. From jewelry and sculpture, to a store of wealth and symbol of status few other elements could claim the mantle of historic importance like gold can. Traded on many exchanges with both cash and futures contracts, these specifications are for the futures contract from the CME Group.

Contract Size: 100 troy ounces

Price Quote & Tick Size: Dollars and cents per ounce; minimum tick size is ten cents per ounce or $10.00 per contract.

Contract Months: All months

Trading Specs: Open outcry on runs from 8:20 am to 1:30 pm ET. Electronic trading on Globex runs Sunday through Friday 6:00 pm until 5:15 pm with a 45 minute break each day.

Daily Price Limit: As of date of initial publishing, there were no daily limits; however, it is wise to consult exchange.

Trading Symbols: GC or EGC for Globex
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Past performance is not indicative of future results.
***chart courtesy of Gecko Software

Gold Facts


Gold is a chemical element which occurs as nuggets or grains in rocks. This dense metal is also soft and shiny making it a natural choice for early jewelry and adornments. Gold is also naturally resistant to corrosion giving it modern appeal in dentistry and electronics. A popular choice for use in everything from wedding rings to coins, gold has been located in almost 90% of the land areas on earth. Even the oceans contain gold – possibly up to 2 mg per ton , however, extracting it would be too costly on a large scale.

Gold is normally combined with other metals as pure gold is too soft to be applied in ways that result in frequent handling. Although gold mining is an important source of world gold, it is also one of the most recycled metals today meaning that the supply and demand dynamics are a little removed from the normal production and consumption cycle.
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*Data courtesy of the World Gold Council

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*Data courtesy of the World Gold Council

Gold mining can be traced back to early Egyptians around 3500 B.C. and the largest known deposit of the yellow metal is in South Africa. Today, gold mines are operated all across the globe with the most important – or at least the most prominent – in South Africa, the source of 40 percent of modern gold mining, and China.

Important Modern Gold Discoveries:

North Carolian Gold Rush 1803
California Gold Rush 1843
South African Gold Reefs 1886
Kalgoorlie's Golden Mile in Western Australia 1893
Klondike Gold Rush, Yukon, Canada 1896
Serra Pelada, Brazil 1983

The latest estimates and projections from the US Geological Survey provide an illustration of world mine production as follows:

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Data courtesy of the USGS

Price highlights for this market include:

* In the early 1970s, the US devalued the dollar and currency exchange rules change, boosting the price of gold.
* In January of 1980 gold soared to a record high of more than $800 per ounce on geopolitical tensions and inflation issues.
* By 1999, gold was heading towards a low of nearly $250 per ounce on rumors of central bank and other large gold sales.
* The Central Bank Gold Agreement boosted gold prices above $300 an ounce. By 2003, prices were gaining on concerns ahead of the Iraq invasion.
* Early 2004 saw gold prices heading higher, moving above $400 on increased investment demand.
* April of 2006 saw gold move above $600 per ounce on a weaker US dollar and increased commodity investing. Geopolitical tensions helped push the market higher for the rest of the spring. By June, prices had fallen more than 25 percent as speculators closed positions.
* In early 2008, gold prices hit above $1,000 per troy ounce on economic concerns. By the end of 2009, fears had boosted gold to fresh record highs above $1,200 an ounce.
* 2010 and 2011 continued to see new price highs for gold as economic issues persist.

For more at commoditytrading.yuku.com/topic/599/The-Learn-About-Futures-Insider-for-July-28-2011-Gold