The price of gold is rising: is it time to invest?

Discovered billions of years ago, gold has established itself as one of the metals most coveted by investors. Initially used in jewelry for jewelry making, gold has continued to increase in value, especially due to its rarity. Therefore, this metal is now one of the most popular investment assets. If you are thinking about investing in gold, discover key information about it.

What is driving the rise in gold prices?

According to a recent study, gold has become the third safest investment in France. However, this good health of gold is temporary and depends on a number of factors. It is common to notice increases in the price of this metal in specific periods. One of the main causes of this variation is political and social instability in producing countries such as South Africa. It is important to know that in times of crisis investors tend to buy gold at a high price. Added to this are the numerous fluctuations in the value of the dollar.

In fact, the price of gold depends on this currency in more ways than one. First of all we must clarify that most metals are expressed in gold. Furthermore, the fall of the dollar induces an increase in the value of other currencies, which generates great interest in gold. Furthermore, the close relationship between supply and demand is an element that influences the value of gold. Strong demand in the gold market is also driving up the price of gold. So, the greater the demand, the more the value of this asset increases. To know the variations in the price of gold, there are online platforms that provide information on the price of the yellow metal in real time.

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How to buy gold and what are the risks involved?

The most classic way to acquire gold is by purchasing it in its physical form, called investment gold. To do this, contact banking institutions that can guarantee completely legal transactions. Likewise, exchange houses as well as specialized brokers generally offer this type of service. On certain specialized sites you can also buy gold coins or bars at discounted prices. This method is even more advantageous because buying online saves you the commissions that certain financial institutions may require. Please note that in its physical form, the purchase of the yellow metal is exempt from VAT.

Additionally, it is possible to own gold through gold certificates or paper gold certificates. They are documents that prove the possession of the metal. Gold certificates, most frequently issued by banks, are financial products that allow you to invest in the yellow metal. The greatest advantage of gold paper is that it avoids the possible limitations related to the conservation of this metal. Finally, jewelry or other gold necklaces offer you another way to store gold. For information, the jewelry sector accounts for approximately 50% of global gold demand.

The best ways to store your gold investments for the long term

If you have just purchased gold bars and want to keep them, keep in mind that you have several options available. To have your property available when needed, choose in-home storage. In fact, this solution is more economical, because you yourself guarantee the security of your goods. However, remember to choose a safe place in your home and only keep small amounts of gold in your home.

On the other hand, more and more investors prefer to entrust their assets to private structures. These are companies that provide services in the purchase and sale of precious metals such as gold. They guarantee the storage of your assets in exchange for a remuneration whose duration depends on the conditions of the contract. One of the biggest advantages of this solution is that the contents of the safe are entirely in the name of the owner. Therefore, in the event of the supplier's bankruptcy, you will be able to recover your investment with complete security.

What happens if the price of gold suddenly drops?

As we have mentioned, many factors influence the price of gold. This fluctuation can manifest itself as a rise or fall in the value of this metal. In the latter case, panic usually follows, characterized by a massive sell-off in gold. Most of the time, the goal is to have immediate liquidity. Likewise, periods of recession in the price of gold usually correspond to those in which other types of investments are green. We strongly recommend that you diversify your investment portfolio to cope with periods of inflation that financial products face.

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The advantages of investing in gold over other investments

Once considered an ornament, gold has established itself as a safe bet in terms of investment. Whether it's real estate, life insurance, or even the stock market, all of these investment vehicles regularly face market fluctuations. On the other hand, investing in gold protects you from stock market declines because it generally retains its value even in times of crisis. Furthermore, this metal is used in all parts of the world. In other words, you can transact gold regardless of your geographic location.

Unlike the stock market or cryptocurrencies, gold allows you to invest in a physical asset. This is very advantageous because you are protected from liquidity defects that occur in certain investments. This way, if necessary, you can sell or exchange your gold and have capital at any time. If many experienced investors prefer to invest in the yellow metal, it is also because of the tax advantages it entails. In fact, the purchase of gold in the form of bars or coins is not subject to VAT. Similarly, after a certain number of years of holding gold, i.e. 22 years, you are exempt from all possible taxes. Likewise, you will benefit from a 5% reduction in your taxes after 3 years of owning gold.

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