Gold is a Key Asset
Investors continue to buy gold inspite of a 9 % drop in its value over the last month. Gold is now trading at $835 an ounce losing nearly all its gains. This is mainly due in part to the strengthening of the US dollar. ETF securities, however, reports its Physical Gold Fund has seen more buyers than any other exchange-traded commodity since mid-July, when gold prices first began to fall.
If the dollars strength is short lived, which many believe it will be, the price of gold is likely to go up again. Longer term speculators are using the recent fall in the price of gold as a buying opportunity. Many people have been waiting to get into the market but it was too high and are now looking at this current situation as a great buying opportunity. Many predict that in relation to the dollar the price of gold will end up at $1000 to $1200 by the end of the year.
The Indian market has an effect on the price of gold bars over the summer as this is their festival season. This always causes an over selling of gold and then the market has to realign itself.
Concerns about the long term outlook for the dollar and inflation affect the gold bullion price but at the moment one of the triggers for investing in gold is the economic uncertainties which lie ahead of us.
If you do not have gold in your portfolio you need to think again, as it should be an essential part of it. If you can buy it at $850 or less then it’s a bargain.
Tags: Gold, Gold Bullion, Investing, investments