Other precious metals have done better this year. Silver futures rose 61% through Nov. 19 and would have to gain another 85% to reach the record $50.35 an ounce reached in New York in 1980. Palladium advanced 72% in London and would need to add another 60% to match the all-time high of $1,125 an ounce reached in 2001.

Investors bought shares of ETPs representing 1,081 tons of silver worth $945 million since the end of September, according to data from four providers compiled by Bloomberg. Gold in ETPs such as the SPDR Gold Trust, the biggest, fell 9.5 tons. Investors may have considered silver cheap relative to gold and bet that it would benefit from the economic recovery, said Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt.

'Biggest Drawback'

Industrial applications account for 9% of gold consumption, while for silver it's about 50% of demand, according to GFMS Ltd., a London-based research firm.

Speculators in Comex gold futures cut their net-long position, or bets on higher prices, by 11% to 218,479 contracts in the week ended Nov. 16, data from the Commodity Futures Trading Commission show. That's still about 40% more than the average over the last five years.

"The biggest drawback for gold right now is that it's just so darn popular," said Barry James, who manages $2.2 billion as chief executive officer of James Investment Research Inc. in Xenia, Ohio. "Gold has become a fad and there's a little mania involved in this rally."

Soros, who made $1 billion breaking the Bank of England's defense of the pound in 1992, described gold at the World Economic Forum's January meeting in Davos, Switzerland, as "the ultimate asset bubble." Buying at the start of a bubble is "rational," he said.

'Pretty Ideal'

"It's all a question of where are you in that bubble," Soros, 80, said in a speech at a meeting organized by the Canadian International Council in Toronto on Nov. 15. "The current conditions of actual deflationary pressures and fear of inflation is pretty ideal for gold to rise."

"The big negative is that too many people know this and a lot of hedge funds are very heavily exposed," Soros said. "Gold has shown tendencies to go parabolic and usually bubbles tend to end in that parabolic rise before the collapse."