In the third quarter, George Soros sold approximately 10% of his position in SPDR Gold Shares (NYSE: GLD), Soros Fund Management's largest reported position. Is the man who called gold "the ultimate bubble" opening the escape hatch on the gold rocket before floating back to earth with his profits from the trade?

The bubble won't last forever
The answer is not yet, for as he was selling the world's largest gold ETF with one hand, Soros was scooping up shares of the competing iShares Gold Trust (NYSE: IAU) in roughly the same amount with the other. I now agree with Soros that gold is a bubble. When I first said so here at the beginning of the month, warning that gold could fall below $500, it generated more interest than any article I have ever written for the Fool. Soros thinks it may be rational to participate in a bubble ... at the beginning. I understand that logic. However, as Soros himself told Reuters in September: "[Gold is] certainly not safe, and it's not going to last forever."

Paulson is firmly on board
John Paulson -- the man who made $3.7 billion personally in 2007 by betting against subprime mortgages -- has maintained a huge $4 billion position in the SPDR Gold Shares. The exchange-traded fund is also his largest reported position, at 18% of Paulson & Co.'s assets. Paulson reduced his position in major gold miner AngloGold Ashanti (NYSE: AU) -- his second largest position -- by roughly 7%. As of Sept. 30, the fund also owned shares of miners NovaGold Resources (AMEX: NG), Gold Fields (NYSE: GFI), and IAMGOLD (NYSE: IAG).

A worrying trend
Another extremely shrewd investor who has joined the gold rush is Dan Loeb from Third Point LLC, who opened a position in the SPDR Gold Shares in the third quarter. Loeb is less well-known than Soros and Paulson, but he has a comparable track record (18.3% annualized return since December 1996). Loeb joins a coterie of prominent value investors who have placed bets on gold, including David Einhorn. Nevertheless, when even value-driven investors start buying a speculative asset with no intrinsic value, it's an unsettling trend, to say the least.

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