Gold has always been an investors favourite for as long as we can think. For thousands of years, gold was the global medium of exchange and, until 1971, it was the standard upon which the US dollar valued itself until it was finally discarded.
A few years back it did get hit by the increasing popularity of crypto currencies, but as they rightly say- NOTHING NEW UNDER THE SUN!
A few weeks back, the cost of a single bar of gold pushed through the $US1 million mark as the precious metal surged to new records.
Gold prices have doubled since 2019 and, in the past two years, have headed into orbit as inflationary clouds gathered over the global economy, leading to fluctuating Gold prices today in India.
But despite most major developed nations signalling victory over inflation — with interest rate cuts in the UK, Europe, Canada and the first expected this week in the US — the upswing hasn’t subsided.
Already this year, the price has jumped 21 per cent, consistently punching through new records.
And as we know, at any given point , some or the other global crisis always prevails- be it COVID, wars between different nations, geopolitical issues, elections etc. Hence it is believed that at any given point, gold will always have a strong support from where it spikes.
Such a similar trend was witnessed this year too. Since the onset of Covid, gold has seen a good amount of gain. Though there have been downfalls, but compared to the decline, the upswing has been significant.
Gold investing has seen a surge of interest in recent years thanks to an inflationary economic climate and the benefits the precious metal can provide when prices rise. But with inflation cooling and cuts to interest rates looming for later this year, those who invest in gold now will be entering a different market than those who invested in the shiny metal in 2022 and 2023.
That doesn’t mean that gold investing still can’t be advantageous, however. Prospective investors just need to be aware of the market scenario before making any investment decisions. Timely analysis of the market, can help maximise the returns. And while some of these factors are the same as they’ve traditionally been, others may be more specific to investing in gold this September. Below, we’ll break down what you need to know before getting started with gold.
We have always asked investors to follow only one mantra- BUY AT DIPS. It’s always good to get invested early when prices are low. Yes, you would say that the prices have sky rocketed and its not feasible to invest now, but the continuously rising price is an advantage for many investors. With numerous price records already broken this year and the potential for gold to surpass $3,000 an ounce soon, investors who get started with gold now could turn a quicker profit than they normally would by investing in precious metals.
Furthermore, with concerns over unemployment, a steadily cooling inflation rate and multiple prospective interest rate cuts to come, major economic changes will likely soon take place. In times like these investors can benefit from the security that gold can offer your portfolio. While stocks and bonds may rise and fall depending on the aforementioned factors, gold tends to maintain and even rise in value during these circumstances. So, by investing now, you’ll be better able to withstand these developments when they occur. For example, the upcoming U.S presidential elections. Irrespective of who emerges victorious, the impact that results will have on gold will be significant and hence adding gold to your portfolio is advisable.
Gold has gone global. It is not only a form of jewellery that can be worn, its not only a form of reserve, it is not only a form of medium exchange- but it is also available in various forms for example ETF’s, bonds, digital gold etc. Not only can investors turn to the traditional ways of getting started with local dealers, jewellers and pawnshops but they can also peruse multiple gold investing companies online right now. Given the diversified forms in which it is available and they way it caters to all types of investors- irrespective of their capacity, one can surely vouch for this metal.
With gold’s rising price and the potential for major economic developments in which gold can act as a portfolio protector, now is a great time to get invested in the metal, considering Gold rate today. But, like any other asset, there are some drawbacks to gold that investors should be aware of, too. By understanding and applying them, they can best determine if gold is the right move for them.