Gold investment fundsGerman López Pérez
Investment funds specialized in gold have had a great boom in recent years. This is due to the fact that investment in gold is very significant in periods of political or economic crisis, as it is traditionally considered, together with the Swiss franc, the safe haven value par excellence.
With these data it can be tempting to invest in gold-based exchange funds, but there are several factors to consider:
- The speculative component As in many specialized funds, when a high return occurs over a series of years, a sharp decline can occur until its price stabilizes. You know … “Speculator looking for a new bubble to invest in”, and the last one to leave pays the drinks.
- The exchange rate between the dollar and the euro , in the case of gold it is crucial, since the yellow metal is priced in dollars. A collapse in the price of the Euro can lead to the price of gold at astronomical figures, and an appreciation of the euro produce the opposite effect, although in general its price tends to offset this effect and when the dollar falls, gold rises and vice versa.
- The demand for gold . Although now in Spain with the crisis people consume less jewelry items, we must take into account to the countries that are experiencing significant growth and that are demanding gold in increasingly important quantities (China and India). A sudden crisis in these countries can sink prices.
Investing in gold can be done in several ways: with the purchase of gold bullion , the acquisition of jewels and gold coins , or the easiest ones gold-based mutual funds, which are not very widespread in Spain but they are in other countries such as the US. As in any investment, remind you to always analyze the risks and possible benefits and take great precautions against any decline …