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Should I buy gold? Journalist John Mitchell investigates

"JohnIt’s a sunny Friday morning and I find myself in a Surrey pub at 10 o’clock in the morning. I’m attending a local business networking group.

There are around 20 people at this meet-up, many are sole business owners such as florists and Reiki healers but others are representatives from high street banks.

In this networking group, each attendee has an opportunity to stand up and promote their business for 10 minutes in a monthly ‘on the spot’ slot if they wish. It’s a time for these businesses to also share tips.

We gather round in a circle and I keenly listen to the talk by a financial services advisor. He reports on the state of different markets and advises, quite rightly, that investors should spread their portfolios.

By their very nature, many self-employed people are risk takers. When asked at the end of the talk if anyone has any questions, I raise my hand.

 

Taken Back

I have been reporting on the metals markets for a number of years. I know in the long-term that gold has historically proved a good return on investment, so I ask this group whether they would consider the precious metal as part of their investment plans. Would gold shine for them?

I was taken back. The overall consensus was that gold was for the short-term only and too risky. This was only a tiny snapshot but I wondered if it gives a clue about how some investors feel generally about the yellow metal.

I argue the case to the networking group that in actual fact gold should be thought as more of a medium to long-term investment like an insurance policy. I also said that investors should not put all their money into gold.

 

Oldest Bullion Dealer

"OliverThese are points that Oliver Temple, a senior bullion dealer at one of the oldest bullion houses in the UK echoes when I meet him a few days later in his City offices over a coffee.

“We advise that gold should only be around 10% – 15% of an investment portfolio. We had people buying up gold quickly after the Brexit referendum last year and then selling almost immediately.

"Some did well but personally I think this strategy was too risky. Gold prices can be volatile so that’s why people should take a wider view of the metal.”

 

How To Invest In Gold

I point out to Oliver that some people may not even be sure about how to invest in gold.

“That’s true, it can seem daunting for new investors but we’re always happy to share our knowledge.”

And it is this wealth of knowledge that has been one of the reasons that Gold Investments has built up such an enviable reputation since it was started by Oliver’s father, Mike, in 1981. Impressively, Gold Investments still has many of its original customers.

 

Special Service

Unlike other gold dealers, the team also provides a very special personal service.

I ask Oliver how he feels gold prices will pan out this year and crucially the question that I often hear: “Should I buy gold?”

“We know from past experience that gold reacts when there is economic volatility. The US air strikes on Syria against the chemical attack on 7th April have made investors nervous. Gold prices have been increasing this week.”

Spot gold rose 1.3 percent to $1,267.43 per ounce by 0225 GMT, after touching a high of $1,269.28, its highest since November.

 

Volatility

“ Gold tends to do well in times of economic uncertainty. There’s the potentially increasingly fractious relationship between the US; Russia has condemned the US air strikes this week on President’s Assad’s regime. The US is also pushing China to do more regarding North Korea so there could be friction there. 

“This is also against our own backdrop of how the UK will fair after the country is divorced from the EU. Ultimately, it’s down to investors to decide how much and when they want to buy gold but we’re always happy to advise.”

 

Demand For Gold

With more demand for gold, the yellow metal’s prices will increase. It will be interesting to carry out another straw poll soon of business people I networked with to see if their views on gold has changed.

I suspect that with the yellow metals’ prices rises, some could well be interested if only to buy a Sovereign to test out the market. 

Gold Investments offers a wide range of gold bars and gold coins on the market which are often the cheapest on the market. For a confidential chat, call Oliver on: 0207 283 775 or email: info@goldinvestments.co.uk.

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