The gold price just hit an all time high ($1,944/ounce). That's R32,000 in South African Rands. How heavy is an ounce? Roughly the same as a 60 watt light bulb or a CD.
Everything you need to know in 90 seconds [Thread]
Everything you need to know in 90 seconds [Thread]
Why it the gold price soaring?
A) Gold is usually seen as a safe haven investment during periods of uncertainty
B) Place to store value when interest rates are low
C) Used to hedge against inflation
D) Speculators who trade gold - but don't necessarily take delivery of it
A) Gold is usually seen as a safe haven investment during periods of uncertainty
B) Place to store value when interest rates are low
C) Used to hedge against inflation
D) Speculators who trade gold - but don't necessarily take delivery of it
A) Gold as a safe haven investment
It's 2020 & the world is on fire - even Jesse Lingard is scoring goals.
- US/ China tensions are flaring up... again
- COVID isn't slowing down (62k new cases in the US)
- Concerns about the real economy is deepening
- Impending US elections
It's 2020 & the world is on fire - even Jesse Lingard is scoring goals.
- US/ China tensions are flaring up... again
- COVID isn't slowing down (62k new cases in the US)
- Concerns about the real economy is deepening
- Impending US elections
B) Gold becomes attractive in a low yielding rates environment
One of the sexiest charts in all of finance - gold has a near perfect inverse correlation to interest rates. Why pump cash into low yielding securities when you could put it under your mattress or better, into bling?
One of the sexiest charts in all of finance - gold has a near perfect inverse correlation to interest rates. Why pump cash into low yielding securities when you could put it under your mattress or better, into bling?
C) Gold as an inflation hedge
Right now, there isn't much inflation. Nobody is really spending any cash. Enter stimulus! Central banks around the world have turned on the taps & they're making it rain. At some point it's expected to kick into a short term surge in inflation.
Right now, there isn't much inflation. Nobody is really spending any cash. Enter stimulus! Central banks around the world have turned on the taps & they're making it rain. At some point it's expected to kick into a short term surge in inflation.
D) Speculation fueling prices
Remember when oil prices went negative (for a brief period)? People were paying you to take oil off their hands (excess supply)
With gold it's the opposite (limited supply) - there's fears everyone decides to take physical delivery at the same time
Remember when oil prices went negative (for a brief period)? People were paying you to take oil off their hands (excess supply)
With gold it's the opposite (limited supply) - there's fears everyone decides to take physical delivery at the same time
Where to from here?
Is it a good time to pawn of your granny's jewelry? Absolutely. Bonus points if you take if off her while she's asleep.
Worryingly, right now there's a strong correlation between stocks, golds & bonds. It generally ends badly when asset classes move together
Is it a good time to pawn of your granny's jewelry? Absolutely. Bonus points if you take if off her while she's asleep.
Worryingly, right now there's a strong correlation between stocks, golds & bonds. It generally ends badly when asset classes move together
If you melted all the gold mined in the entire history of the world - it would fit into an Olympic sized swimming pool. This "little" bar is worth $800k (or R13.2m).
visualcapitalist.com/12-stunning-vi… has more comparisons.
visualcapitalist.com/12-stunning-vi… has more comparisons.
How do I invest into gold?
Buying stocks directly in gold mining companies is an option but comes with other exposures: labour issues/ shutdowns/ exposure to other metals in the portfolio/ management issues
AngloGold is up 92% this year. Harmony Gold is up 136%. Solid returns.
Buying stocks directly in gold mining companies is an option but comes with other exposures: labour issues/ shutdowns/ exposure to other metals in the portfolio/ management issues
AngloGold is up 92% this year. Harmony Gold is up 136%. Solid returns.
Another investment option is a Gold ETF, a precious metals index or the actual gold itself.
Of course, if you watched Money Heist you know the costs of insurance, storage and security of physical gold can be a massive headache.
Of course, if you watched Money Heist you know the costs of insurance, storage and security of physical gold can be a massive headache.
Useful reads:
1. bloomberg.com/opinion/articl…
2. ft.com/content/550d90…
3. cnbc.com/2020/07/27/gol…
4. goldprice.org
5. visualcapitalist.com/12-stunning-vi…
1. bloomberg.com/opinion/articl…
2. ft.com/content/550d90…
3. cnbc.com/2020/07/27/gol…
4. goldprice.org
5. visualcapitalist.com/12-stunning-vi…
If you made it to the end of this thread...
