With half of 2012 in the record books, it's important to take a look at whether the stocks that interest you can live up to their full potential. By making sure you know about a company's future plans and possible challenges, you can make a better decision about whether it's a smart investment for your portfolio.
Today, let's take a look at Central Fund of Canada
Stats on Central Fund of Canada
|HSBC Gold Price Estimate, 2012||$1,760 per ounce|
|HSBC Gold Price Estimate, 2013||$1,775 per ounce|
|Deutsche Bank Silver Price Estimate, 4th Quarter 2012||$38 per ounce|
|Deutsche Bank Silver Price Estimate, 2013||$42 per ounce|
|CAPS Rating (out of 5)||***|
Sources: HSBC, Deutsche Bank, and The Motley Fool.
What will the rest of 2012 bring for Central Fund of Canada?
There are only three things that affect Central Fund of Canada's price. The two most important are the price of gold and silver bullion. Although I've listed a few price estimates above, you can find a wide variety of opinions about where bullion prices could go.
One way to look at demand for precious metals is to look at the holdings of popular exchange-traded funds. For instance, SPDR Gold
The other component of Central Fund's pricing comes from its premium or discount to net asset value. Lately, the fund has had a relatively modest premium of about 3%, well below its five-year average of 7%.
Fool precious metals expert Christopher Barker strongly believes that gold and silver bullion will head higher. But as he points out, miners Goldcorp
Central Fund of Canada has some interesting prospects, but I'd suggest you look at another company that could do even better. Read The Motley Fool's latest special report on gold to discover the tiny gold stock digging up massive profits. It's free but only available for a limited time.
Click here to add Central Fund of Canada to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.
Fool contributor Dan Caplinger owns shares of Central Fund of Canada. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.