Our ever-popular Periodic Table of Commodity Returns has been updated through 2012. Investor Alert readers love this chart as it shows a decade of results across 14 different commodities, providing strikingly rich information in a very familiar format.

Last year, 11 commodities rose in value, with wheat rising as the top crop after seeing a significant decline in 2011. It was a similar rags-to-riches story for the next few leaders, including lead, zinc, natural gas and platinum, which all climbed double digits in 2012 after falling in 2011.

Only three commodities declined over the year: Crude oil fell by 7 percent after rising 8 percent the previous year. Nickel declined for the second year in a row. In 2012, the metal lost 9 percent and in 2011, nickel fell another 24 percent.

Coal was the worst-performing commodity in 2012, falling nearly 17 percent. Coal’s been going through a rough spell lately; in fact, the commodity has not been king for five years (although it did record a 31 percent increase in 2010). As Global Resources Fund Portfolio Manager Evan Smith explained to listeners during our recent presentation, for the first time ever in the U.S., natural gas provided more electricity and power than coal did.

As you can see from the table, commodities often have wide price fluctuations from year to year given the many factors affecting supply and demand, such as government policies, union strikes, and currency volatility. That’s why when it comes to commodities and commodity producers, many investors “leave the driving” to active money managers who understand these specialized assets and the global trends affecting them.

Take gold and gold companies, for example. After investing in the mining industry for decades, we’ve taken note of several facts about gold that continue to surprise our investors. Here are four of the latest:

1. Gold Has Been A Consistent Performer Over The Decade
While the precious metal did not shoot the lights out in 2012, gold’s bull rally goes on. It ended the year up 7 percent, making it a phenomenal 12th year in a row that gold rose in value. In a special gold bar version of the Periodic Table below, you can easily see gold’s rotation among the commodities from year to year.

What’s fascinating is the three-year rising pattern relative to other commodities that emerges when you focus on the bars. Over the past 10 years, gold has risen in position compared with the others for three years in a row, then fallen in relative position in the fourth year before repeating the cycle. Will it follow the same pattern and be in the top half of the Periodic Table in 2013?

2. Gold Should Remain A Hot Commodity In 2013
Considering the global easing cycle and the continuous running of monetary printing presses, I believe the Fear Trade will continue to be a driver of gold over the next several months. Take a look at the projected rise in the balance sheets as a percent of GDP from the European Central Bank, the Bank of Japan, the Federal Reserve and the Bank of England over 2013. The ECB is estimated to have a balance sheet that is nearly 50 percent of its GDP by the end of the year. The Bank of Japan is right behind the ECB, with its balance sheet projected to be nearly 35 percent of GDP. As Mike Shedlock of Mish’s Global Economic Trend Analysis said, “The race is on to see which central bank can load up its balance sheet with the most garbage the fastest.”

My friend Ian McAvity also summed it up well in his Deliberations on World Markets: “Gauging from the panicky actions of the major central banks, I would still prefer to own gold than their paper.” With the monetary printing presses warm and real interest rates in the red, gold will likely glimmer for another year.

3. Gold Is The Least Volatile Commodity On The Table
Given the fact that every gold move is analyzed and dissected by the media, it may surprise you that this precious metal was actually the least volatile of the 14 commodities. Its rolling 12-month standard deviation (sigma) over the past 10 years has been 14 percent, compared to the most volatile commodity, (nickel), which has a rolling 12-month sigma of nearly 60 percent.

Here’s another way to look at the surprisingly low volatility of gold. Take a look at the frequency of 10 percent moves up or down over any 20 trading days. The metal is only slightly more volatile than the S&P 500. Gold companies, crude oil and the MSCI Emerging Markets Index have all experienced more up and down moves than gold.

Whereas card counting at a Blackjack table can get you booted from casinos and barred for life, as an investor, you are allowed to take full advantage of counting the 10 percent moves.
Over 2013, you can count on gold moving in either direction, so even if the metal experiences extreme volatility to the downside, regardless of what the headlines report, Investor Alert readers know that any dip in price offers potential buying opportunities. Keep in mind though, that it’s prudent to invest only 5 to 10 percent of your total portfolio in gold and gold stocks.

4. The Last 4 Years Were Better Than You Thought
Recently, I showed how the S&P 500 Index and gold bullion significantly outperformed the iShares Core Total US Bond ETF. Many investors asked about gold stock performance. As you can see below, the NYSE Arca Gold BUGS Index (HUI) experienced quite a gain, increasing more than 50 percent on a cumulative basis since the beginning of 2009. Both considerably outperformed the bond investment.

What’s sensational news to precious metals investors sometimes doesn’t make the cut as breaking news. We emailed a message to our readers on Friday, asking you to tune in to CNBC to see me talk about silver. I’m pleased to hear that there were many of you who tried to tune in (Thank you!), but I’m sorry to say the reporters preempted my investing insights for what was viewed as a more sensational story about millionaire and fugitive John McAfee.

In the meantime, I’ll continue sharing these fascinating facts about gold, silver and other commodities with investors at Cambridge House’s Resource Investment Conference in Vancouver and the World Money Show in Orlando, Florida. Hope to see you there!

Please consider carefully a fund’s investment objectives, risks, charges and expenses. For this and other important information, obtain a fund prospectus by visiting www.usfunds.com or by calling 1-800-US-FUNDS (1-800-873-8637). Read it carefully before investing. Distributed by U.S. Global Brokerage, Inc.
Past performance does not guarantee future results.

Foreign and emerging market investing involves special risks such as currency fluctuation and less public disclosure, as well as economic and political risk. Because the Global Resources Fund concentrates its investments in a specific industry, the fund may be subject to greater risks and fluctuations than a portfolio representing a broader range of industries.

All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor.

The S&P 500 Stock Index is a widely recognized capitalization-weighted index of 500 common stock prices in U.S. companies. The NYSE Arca Gold BUGS (Basket of Unhedged Gold Stocks) Index (HUI) is a modified equal dollar weighted index of companies involved in gold mining. The MSCI Emerging Markets Index is a free float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets. Standard deviation is a measure of the dispersion of a set of data from its mean. The more spread apart the data, the higher the deviation. Standard deviation is also known as historical volatility.

It’s getting a little more difficult to be green in the Evergreen State these days. Beginning in February 2013, electric car owners will be receiving conflicting messages: Drivers are getting tax incentives from Washington D.C. for plugging in instead of fueling up, but those savings will be offset by Washington state’s new annual tax on fuel efficient cars.

The U.S. has made it a national priority to increase fuel efficiency, with plans to inject $7.5 billion into the electric vehicle industry over the next seven years, according to The Washington Post. The amount includes tax credits for as much as $7,500 toward the purchase of plug-in hybrids and all-electric cars such as the Chevy Volt, the Nissan Leaf or the Toyota Prius. The government also provides grants to electric battery manufacturers and loans to automotive companies for the production of electric vehicles.

Drivers of fuel efficient vehicles have additionally benefited from paying less in gasoline taxes. In some states, this can add up. After Americans factor in 18.4 cents per gallon of gas in federal tax, the state’s tax on gas can be as high as 39.15 cents per gallon in North Carolina or as little as 7.5 cents per gallon in Georgia.

The state of Washington has one of the highest state gas taxes in the nation, with drivers paying a tax of 37.5 cents per gallon.

(You can find out how much your state taxes are by checking out bankrate.com’s interactive map.)

Now, to make up for lost revenue, Washington state will be charging residents who own fuel-efficient vehicles an annual tax of $100. The state has decided that electric car owners need to “contribute their fair share to the upkeep of our roads,” says Washington State Senator Mary Margaret Haugen who sponsored the bill.

It’s not only the Evergreen State sending inconsistent signals to fuel conscious drivers: Oregon, Kansas, Arizona and Utah have also toyed around with a similar tax, says The New York Times.

For consumers and global resources investors alike, I believe government policies are precursors to change. It’s interesting to see that the state has chosen to garner more money from its residents to pay for its roads instead of employing fiscal discipline or finding cost effective ways to maintain its infrastructure.

By clicking the link above, you will be directed to a third-party website. U.S. Global Investors does not endorse all information supplied by this website and is not responsible for its content. The following security mentioned was held by one or more of U.S. Global Investors Funds as of 12/31/12: Toyota Motor Co.

On Wednesday, I talked about three of the top 10 commentaries that were popular over 2012. Here are a few more to highlight.

7. There’s No Place Like America

The news media was inundated with footage of strikes in Europe by unionized government workers and the unemployment rate among the youth skyrocketed in Spain, Greece, Portugal, Italy and Ireland. I shared an excellent quote from Ian McAvity which is worth repeating: “When times get tough, economic nationalism and protectionism tends to rise because it is always easier to blame someone else for self-inflicted problems.”

In the post, I compared the woes in the European Union to the U.S. and shared an infographic that U.S. Global created showing “How much goods costs around the world.” This infographic was one of the most shared visuals of the year on Facebook, especially because it was so surprising how much a gallon of gas costs in Europe and Brazil compared to the U.S.

6. Significant Impact of Oil Production in the U.S.

This very recent commentary wasn’t showcasing a brand new trend, but was popular in that it highlighted the important contribution the U.S. was making to the commodity space because of shale growth. Our headquarters sits right smack in the middle of one major area of shale activity and earlier this year I wrote two stories that highlight the benefits that Texas has received because of it. See Texas Ranked Best for Business (Again) and Bright Economic Lights of Texas.

5. Weighing the Evidence of Oil and Gold Stocks

Over the past year, resources companies had been significantly underperforming their underlying commodities. I identified the disparity as an opportunity in April, as my experience tells me that stocks generally revert to their means. I only had to wait a few months before news came out that state-owned companies in Asia sought to take advantage of this discrepancy. China’s oil giant CNOOC announced its purchase of Nexen and Malaysian company Petronas announced its takeout of Progress.

Did you miss Wednesday’s blog post where we listed the three of the top 10? Go there now. On Friday, I’ll conclude with the remaining four. Here’s a hint: They are the golden nuggets of the year.