In the asset category of”precious metals”, gold is now hugely popular as an investment. This yellow metal has enthralled individuals for ages. The gold market is subject to speculation and volatility as are other niches.
Gold has the most effective safe haven and hedging properties across quite a few countries. Robert Kiyosaki (you know, of”Rich Dad, Poor Dad” fame) known as gold and silver God’s cash.
Here is a brief post on how gold investment operates worldwide and in Malaysia.
Fundamental understanding of the gold Sector
Gold investment doesn’t yield any interest in how a savings account gives. It is used a lot for jewelry or reserves by central banks. Only an estimated 10 percent is utilized for industrial uses compared with 50 percent for silver.
This valuable metal might be an important part of a property investment portfolio because its price increases in response to events which cause the value of paper investments, such as stocks and bonds, to decline.
Even though the price of gold can be volatile in the brief term, it has at all times maintained its value over the long run.
Furthermore, roughly 2500 tons of gold have been mined throughout the world every year. Then South Africa leads the world in gold mining, and the U.S., Russia, Canada, and Australia are also major producers. Truly, mocospace gold mining is performed almost everywhere like in Malaysia.
How much gold was mined up to now?
One estimate puts it that the whole global stock of mined gold could be put in 2 Olympic-sized pools. You agree that it is indeed a limited quantity of gold. Request the Indian or Chinese women.
Some states have also increased their gold reserve holdings recently. China and Russia raised their gold reserves by 800 tonnes by 2014 to 2018 according to the IMF.
This means almost 8 percent of annual worldwide gold production per year went to their reserve holdings. Is something brewing within this asset class? You might wonder if China and Russia understand something that the rest don’t?
That said, the USA (8000 tonnes) and Germany (3000 tonnes) still leads the world in their own gold book holdings.
Gold prices and investing — how exactly does this operate?
You might have noticed or heard of the gold price jog in 2012. The gold price is taken to a summit of approximately USD 1.9K and it’s now at approximately USD 1.2K per oz. Please eyeball the chart below. Makes sense?
Investing in gold in Malaysia
If you are not satisfied with just a gold necklace or ring, you can start trading in gold by opening a gold investment account either with Maybank or a few other monies in Malaysia.
With a gold investment account, you can buy gold based on the bank’s prevailing selling price, in addition to, promoting of gold depending on the lender’s prevailing buying price. The gap between the lender’s buying price and selling price is your profit or loss.
For instance, in the event that you purchased one gram of gold at a sale rate of RM 140 per g, then sold it at the lender’s buying rate of RM 160 per g; your profit from this particular investment would be (RM160 — RM140) = RM20 per gram. It’s fairly straightforward.
Investment in gold is exactly like any other investment; there’s a good deal of speculation involved in the upcoming price.
Or you may also invest (or speculate) in gold futures. This is currently available inside the KLSE derivatives market. But you have to do preliminary research on the way a”futures” functions prior to investing. It’s possible to read sources like Investopedia on which a futures contract is.
In general, you should only consider this type of investment asset when other investment choices (e.g. stocks or bonds or real estate, not in order of importance) has been undertaken.
However, if you are already an experienced investor, this asset class could be researched to diversify your portfolio.