This summer, John Moran picked up 100 ounces of gold from a locker run by the Comex exchange in New York.<\/p>\n
The bars, which were light enough to carry in a backpack, marked the culmination of a $95,000 experiment by Passport Capital, a San Francisco-based hedge fund where Moran is director of business operations and strategy.<\/p>\n
Passport, headed by John Burbank, wanted to find out how easy it would be to buy physical gold, rather than futures contracts or gold exchange-traded funds. The firm was also interested in testing conspiracy theories about the availability of the precious metal.<\/p>\n
Moran used his own money because Passport didn’t want to run the test with its investors’ cash. Everything went smoothly. In July, Moran bought a futures contract on 100 ounces of gold at roughly $950 per ounce for delivery in August. When the contract expired, Comex sent him a notice saying the gold was available for collection in New York at a specific time and date.<\/p>\n
With gold prices down from a recent record, Passport is poised to repeat the process on a bigger scale for investors in its $1.2 billion Global Strategy hedge fund.<\/p>\n