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Investor: Is Gold Really Losing Its Shine?

Investor: Gold bullion expert – Oliver Temple – examines whether the precious metal really has lost its shine.

It is true gold prices have been fluctuating recently. Gold has not performed as well as some analysts had predicted.

There has been a potential increase rate rise in the U.S., the Greece bailout situation, and a weak Chinese economy. All reasons – in theory – that could have shocked investors into buying gold.

"InvestorsThe fear that the world would slip back to the start of the downturn five years ago is at the moment, fear. Has gold then lost its shine altogether?

In July 2015, the commodity price slid to its lowest point in 5 ½ years. Prices rose again quickly before settling back down again.

 

Microscope

At the moment some investors may be viewing prices by only seeing the current performance of the gold price. It’s a bit like looking through a microscope rather than using a telescope.

Yet if some investors were to widen their view, they will see that yes there have been dips, but the gold price has risen steadily against every currency for over a century.

Let’s take a look, for example, at the average price daily London PM Fix per fine ounce (from www.kitco.com – the price most users quote) over the last few years. You can see how gold has climbed and fallen during the recent economic downturn.

 

London PM Fix Per Fine Ounce Gold Price Comparison 

Year

Price

2008

$ 871.96

2009

$ 972.35

2010

$ 1,224.53

2011 $ 1,571.52
2012 $ 1,668.98
2013 $ 1,411.23
2014 $ 1,266.40

Source: www.kitco.com

You can almost trace when investors began to move some of their portfolios into gold. In 2009, for instance, the average London PM fix was $972.35. By 2012, that price reached $1,6699.98.

As the global economy began to settle, so gold prices began to fall. As you can see the price in 2014 dropped to $1,266.40.

 

Waiting

The bottom of the gold market at the moment may or may not have been reached. Some investors may be waiting to see how the global economy does in the months ahead and in particular China and a possible U.S. interest rate rise.

"Gold

It is interesting to see that gold prices have falling and been rising even in the last few weeks of August.

For savvy investors now could be the best time to buy gold.

 


Oliver Temple is one of a number of experts at Gold Investments. The still family-owned business is one of the oldest bullion dealers in the UK with offices in the City of London.

Whether you are a new or existing investor, Oliver and the knowledgeable team would be only to happy to discuss gold options:

020 7283 7752

oliver@goldinvestments.co.uk

Image courtesy of patrisyu at FreeDigitalPhotos.net