Don't panic if you see the trend as follows :-
For investors, the low gold price is a blessing in disguise as you can buy more to add to your basket of investment. They are bought to be kept, remember. For dealers, you can add to your existing stock to be sell away. Who knows, you may have more customers buying at a higher price compared to a low one like this.
Investment in physical gold must be looked upon as medium to long term investment, not a 30 days investment as above. If you can hold for 5 years, it will give you a reasonably high return of investment compared to most instruments in the market.
Let's observe the chart below :-
What can you understand from the chart? Kitco.com tracks live prices of gold and many other metals such as silver, platinum and palladium.
From the past 5 years tracking of live prices, the highest price recorded was USD1423.70 whilst the lowest was at USD538.88/oz.
If you divide these two numbers, you can get Return of Investment of 264% for 5 years. In other words, your investment is more than double (2.64 times) in 5 years. You invest RM5000 in physical gold, the gold is valued at RM13,200 in the next 5 years.
If you divide 264% by 5 years, you will get an excellent return of 52.8% per annum on average. Ain't this good? I would say that it is excellent!!
Some might say that they cannot wait for 5 years. They want shorter time period. I will show you 1-year period from Kitco.com.
Now, what can you see?
The gold price is also on the upward trend. If you buy gold bar 20g in August 2010, you cannot get the same price now. Average price for August 2010 is USD1215.81 (source : kitco.com). That price has left us. It is now selling at a much higher price. Even in today's lowest price, ie USD1368.00/oz)
Can you calculate the return? Highest gold price in the chart is USD1423.70/oz. Lowest USD1061.40/oz.
The return on investment is 34% for the past one year.
Think about it. You tell me if it is good or not.
If you are thinking to start investing, you can buy NOW! The price is cheap and you will never know when it will start leaving you.
Just think about it. I need some feedback from you who have not invested in physical gold. All I can say is I love the double digit return. Oooo yeah!
Other good articles to read :-
- ASB Dividend Announcement
- Money v Gold ~ To Ponder
- "Rich Dad" Robert Kiyosaki on Gold & Silver
- Silver Investment ~ An Avenue to Hedge your Money
Happy browsing. May you become a well-informed person in the world of investment.
I think gold price will never drop as gold price is increasing day by day and that is becoming big panic now days in the country.
ReplyDeleteThanks for your input. Gold prices do comes down after it reaches certain heights. Now, the price is dropping and you get a good chance to buy gold & even silver.
ReplyDeleteNow the silver price has dropped 61.8% from the peak in Sept 2011. Good time to BUY!!
ReplyDelete