DALLAS, July 11, 2013 /PRNewswire/ -- At a time of extreme gold market turmoil and no apparent means of valuing gold, a new eBook: "Gold - Exactly How It's Valued" at Amazon.com reveals precisely how the price of gold is determined and why, with the world's most accurate model. Backed by the only patent issued for a new asset valuation mechanism, published academic journal research, Swiss hedge fund Lombard Odier's replication of an early model, ZeroHedge review and Mineweb feature article, the enhanced model offers a one-of-a-kind tool for investors, asset managers, financial planners, and academics. Its sister model, based on the same Required Yield theorem, is the most accurate model of stock market valuation and bond yield determination as published in New York University's Journal of Financial Markets, Institutions and Instruments, and was awarded patent 7725374.
Contrary to popular belief, gold earns a real yield based on the fact that world real GDP growth outpaces world gold stock growth (a unit of gold increases its claim to world goods and services); whereas fiat money supply outpaces real GDP resulting in loss of purchasing power. There is a market-required real, after-tax yield on all assets in relation to which gold, stocks and bonds are valued that is anchored on long term real per capita productivity growth (a type of heretofore undiscovered Fisher Effect in asset yields). Thus, gold is an investment with inherent real long term return, whereas fiat assets earn real returns through payment of more fiat currency: EPS growth (capital gains), dividends and interest to offset inherent loss of purchasing power of principal. Gold behaves like perpetuity with a growing real interest stream and is inversely sensitive to real yields but varies directly with changes in the expected inflation rate; among other factors in the proprietary model. The Book presents a totally novel solution to the Gold Standard "Gibson's Paradox", proving its validity across 200 years of both fiat and gold standards.
The author, Dallas-based Julian Van Erlach is co-author of the supporting journal papers and holder of patent rights. A separate non-exclusive patent license necessary for U.S.-based computer applications of the model is available through www.RequiredYieldTheory.com and includes a custom gold database and the valuation formula in simple-to-use format. Patents pend in major world jurisdictions. Exclusive book content shows how gold, stock market and bond absolute and relative returns are determined and how portfolios may be structured under varying macro conditions to both maximize returns and minimize risk. The gold valuation formula is compatible with both fundamental and technical investment strategies, describing short as well as long term directionality and extent of gold price moves.
Julian Van Erlach. Tel: U.S. 651-558-6242
SOURCE Nexxus Wealth Technologies, Inc.