Amid the continuing uncertainty in the financial markets investors and fund managers are naturally looking for safe investments to protect their capital and diversify their portfolios against risk.
There are currently a number of factors causing uncertainty in the world markets. The uncertainty created by the continued economic slowdown in China and low US Federal Reserve interest rates have been joined, in Europe at least, by the uncertainty surrounding the UK’s place in the European Union, recent drops in the value of sterling being directly linked to major politicians expressing support for the so called ‘Brexit’ campaign.
Traditionally Gold has fulfilled this safe haven status for many investors. As a testament to Gold’s long term staying power one only has to look back over the course of human history to see the important part that Gold has played for thousands of years due not only to its intrinsic value but also to its universal appeal. Rulers and Monarchs sought to display the wealth of their nations with the precious metal and more recently the Gold Standard was used as a value guarantee against currency in the world markets.
This intrinsic value makes Gold, in the longer term a far more stable investment with long term trends often showing gentle rises and falls as opposed to the spikes and dips in price that can go with stock market volatility.
The current cost of Gold, whilst high when compared with 2015 average is still well short of its record peak of $1900 per ounce in 2011. Trading around $1233 per ounce at the time of writing this blog there is clearly still room for the longer term investor to secure the value of an investment and perhaps even make gains in the future.
World demand for gold is predicted to rise in 2016 according to the World Gold Council with a number of major economies, including Russia and China taking steps to stockpile Gold against the previously mentioned stock market uncertainty.
For those looking for short term gains Gold is probably not in the ideal price range at this stage but for those looking for the stability in their portfolio offered by Gold then now might well be a good time to invest and buy gold. Appreciation of assets is likely to be a longer term goal at this stage but if that matches with your investment profile then why not look at our range of Bullion products