Gold is a "classic bubble" and could go all the way down to $500 an ounce, Fortress Investment's Michael Novogratz said on CNBC Wednesday.
"I personally think gold is toast," said Novogratz, chief investment officer of the Fortress Macro Fund, part of the $55 billion hedge fund group. "We peaked out at $1,900 two years ago."
Gold prices have dropped 27 percent from those lofty levels—plunging through $1,400 in mid-April for the first time since early 2011. Despite moving above that key level for a while since then, prices were trading around $1,393 midday Wednesday.
(Read More: Gold Falls to Three-Week Lows on Stronger Dollar)