Monday, July 18, 2011


As you have probably heard, the gold price has reached the highest price today. It has touched the resistance level of USD1600/oz and mark a new high of USD1601.20/oz at the point of updating this blog.

Just to let you see the evidence of the increase in gold price in real example.

We bought 2 gold bracelets in 2007 at RM75/g. The initial purpose of purchase is for investment. Just keep it until we need money for other important thing.

Let's see what is the price of jewellery today, 18th July, 2011. Source

In almost 4-and-a-half years, the 916 gold has increase from RM75/g to RM173/gm. This is already more than double the gold price. To be exact, the increase in 916 gold is 231% during this period.

Now, I am calculating the rate of return per year of the jewellery should I sell it today.

916 gold price today : RM173
916 gold price in 2007 : RM75

Rate of return per year from the example
= 173/75 divide by 4.5 years
= 51.3% per year.

This is good or this is good? :D

This is a very real life experience to me. To double your money (in this case, in gold jewellery) in just 4 years is definitely awesome. See Rule of 72 in previous article. We should always be looking out for the highest return to double your money. And best, if you do not hold cash much, but to keep in physical gold bar or silver bar to reduce the impact of inflation in your daily life.
Upon seeing the returns, my better half was asking me during lunch today why I did not buy the necklaces as well during that time!! If only, he have persuaded me then (well, I did not want to look greedy buying everything! ;-) ), we will be smiling a bigger smile from ear to ear looking at the hike in gold prices.

See the gold price climbs for the past 2 years :

In July 2010, the lowest price was USD1158/oz. Today, it has reached 1598/oz.
The rate of return is 38% for the past one year.

P/s : Kena dapat komisyen drp kedai Kembang Jaya ni. ;-)

In, the article below is written on 17th July, 2011

$1,600 gold price

Gold Price Climbs Toward $1,600

The gold price climbed toward $1,600 per ounce Sunday night as worries over the surge in borrowing costs for Italy drove investors to add to long positions in the yellow metal. Gold prices, which have risen for ten consecutive days, advanced amid a flare-up of the European sovereign debt crisis. Italian ten-year bond yields crossed 6% last week and traded to record spreads against similar duration German bunds. The lack of deal over the weekend to raise the debt ceiling also helped bolster gold prices late Sunday.

HSBC gold analyst James Steele provided a bullish forecast for the gold price in a note to clients, stating:

“The climate driving gold higher is similar to that of Q2 2010 when gold also jumped to then record highs, buoyed by the emergence of the Greek sovereign crisis and U.S. quantitative easing. Gold is reacting to a similarly bullish cocktail of factors, except that as policy makers appear to have more limited options now, conditions are more gold-bullish now than in 2010.”

1 comment:

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