Although recently overshadowed by the soaring price of Bitcoin, gold continues to attract strong interest from investors looking to protect their assets from inflation and paltry savings rates.
Adrian Ash, director at online precious metals trading platform BullionVault, says his company is ‘seeing unprecedented levels of new interest’ from investors who increasingly see gold as a ‘safe haven’ and an alternative to cash.
The price of gold finished last year at £1,382 a troy ounce, a 19 per cent increase over the calendar year. Despite the price treading water since the new year – currently trading at £1,315 – most experts believe it will rise over the coming months.
Shining example: A survey by investment specialist Global Palladium Fund shows that more than two thirds of professional investors believe gold will increase in price this year
A survey by investment specialist Global Palladium Fund shows that more than two thirds of professional investors believe gold will increase in price this year between three and ten per cent.
Only five per cent believe it will fall in value. These same investors believe a combination of rising inflation – globally, not just in the UK – and continued ‘geopolitical risks’ will put upward pressure on the gold price.
Ash agrees, although he argues that a lot of private investor demand for gold is being driven by low interest rates that are turning people away from cash. With central banks worldwide determined to keep interest rates at zero or below, he sees no reason why gold’s appeal as a store of value will be challenged.
He adds: ‘After 2020 brought record new investor interest, the urge to hold a little gold or silver seems greater still, especially among US and UK investors.’
Exposure to gold can be obtained in various ways. It can be bought via an online trader such as BullionVault.
Alternatively, investors can buy a fund that either tracks the price of gold or holds shares in companies involved in gold mining. Funds include BlackRock Gold & General, Charteris Gold & Precious Metals and tracker iShares Physical Gold.
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