The gold market can see periods of sideways, uneventful trade as well as periods of extreme volatility with large swings in price. The price of gold can move a great deal in a single day, on a weekly basis or on a monthly basis. Whether or not this matters really depends on one thing:
Are you a gold trader or are you investing in gold?
Potential Influences Of The Gold Market
The gold market has many potential influences. These influences include:
- Currency markets
- Monetary policy
- Crude oil prices
- Risk appetite or aversion
- Economic data
- Equity markets
When looking at the gold market, some might feel that the market is simply too volatile and should maybe be avoided.
In fact, nothing could be further from the truth…
If you are a gold trader, you need volatility in order to potentially profit from swings in price…
If you are a gold investor, you simply should not care about these short-term gyrations in price…
In our view, if you want to put your hard-earned money at risk, trading may be a great way to go. Unfortunately, the fact is that the vast majority of traders lose money.
If you want to build a significant portfolio of assets that can potentially appreciate over time, protect your wealth and purchasing power and provide overall peace of mind, then investing in physical gold is the way to go. When we refer to physical gold, we are talking about gold coins, bars or rounds. Actual gold that you can touch and feel. Actual gold that cannot go bankrupt or default and that carries no counterparty risk. In other words, we are talking about real money…
If you are investing in gold with the right mindset, short-term fluctuations in price will not bother you nor concern you.
Because they are irrelevant…
The smart and patient long-term investor is able to “see the forest through the trees,” and simply focuses on the long-term objective.
If that long-term goal is to build a significant holding of gold, silver or other precious metals, then volatility may actually be welcome…
Why would an investor welcome volatility or lower prices?
Because dips in the price of gold represent an opportunity to BUY MORE GOLD while lowering your overall cost basis.
In other words, it may provide a way to dollar-cost-average your purchases.
It’s All About Goals And Proper Mindset
If you are buying gold to protect your wealth from declining paper currency values and you believe that gold prices could eventually reach $2000, $5000, or even $10,000 an ounce or more-does it really matter if prices fell by $15 today, this week or this month?
Of course not…
Gold has been in a long-term uptrend for some time and we expect this uptrend to continue. While gold prices are a couple of hundred dollars per ounce below their all-time high, we believe that this presents an excellent opportunity to buy gold “on sale” and to participate in the resumption of higher prices.
If you consider your long-term objectives and your reasons for owning physical gold, we think you will agree.
So don’t wait for prices to start moving higher again before acquiring more physical gold. Act now…
Advantage Gold representatives are here to help and answer any questions you may have. Our knowledgeable professionals can assist you with setting up a gold or silver IRA and even help you choose precious metals products.