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Gold rush: they project a new record and so you can invest

Gold rush: they project a new record and so you can invest

“With Fed cuts remaining a likely catalyst to soften the ETF headwind later in the year, and right-tail risk coming from the U.S. election cycle and fiscal environment, the bullish bias in the gold remains clear,” Goldman analysts said in a note.

Spot gold rose 2.2% to $2,424.32 an ounce, after hitting a record high of $2,419.79, accumulating a 4% rise for the week. U.S. gold futures gained 2.9% to $2,442.30.

“The positive factors for gold outweigh the negative ones. Rising tensions in the Middle East are the main driver of the recent rally,” said EverBank’s Chris Gaffney.

A supposedly imminent attack by Iran against Israel is a real and viable threat, the White House said, giving no details about the possible timing and reiterating that the United States takes seriously its commitments to defend Israel.

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“Gold continues to strengthen as we witness the obvious fear of missing out,” Ole Hansen, head of commodities strategy at Saxo Bank, said in a note. “The fear of missing out on an ongoing rally creates a strong buy-short mentality, in the process reducing the risk of newly established long positions being called into question.”

Bullion’s recent advance has come even as traders have lowered bets on an early interest rate cut by the Federal Reserve.

“Gold has pulled back on data that normally should have been negative. It will be healthy to see a correction in the bull market, but the trend will remain positive,” Gaffney added.

In other precious metals, spot silver rose 4% to $29.60 an ounce, its highest since early 2021; platinum gained 2.2% to $1,000.80; and palladium advanced 2.7%, to $1,075. All three closed the week on the rise.

Gold: how to invest in this precious metal?

From Grupo Broda, the economist Elena Alonso, points out in this regard that what is done in these cases is “buy physical gold through the banks and keep it in a safe deposit box or wherever the investor wishes.”

The problem, in these cases, according to economist Federico Glustein, is that it is very difficult to make it liquid later because a plaintiff must be found at the right time, which is when it rises, to have better profitability.

In this case, mention that another option is target jewelry or items containing gold, “that can be saved and does not have so much variation over time.” The problem with this option is that the profitability is usually lower and also, of course, the risk of theft, but, as in the previous case, they can be kept in safe deposit boxes.

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“Another more sophisticated alternative is gold futures, a financial operation in which a guarantee is required to carry out the operation,” says Alonso. In that case, if the investor waits for the price of gold to rise and wants to protect his capital, he can buy that asset, whose value responds to the forecasts of the value of the metal. “If gold increases, he will receive a daily difference for the price movement,” he explains.

For Javier Marcus, Southern Cross Business Manager, “the gold futures of MatbaRofex They are one of the best alternatives to invest in gold in Argentina”, since they allow entering and exiting in pesos in a contract for one ounce of dollarized gold.

“It is not necessary to have gold and it allows risk coverage at the price of gold and related assets in a local market. Also, to speculate, it has a great seasoning: allows you to leverage more than 20 times”, he describes.

Marcus explains that this product follows the prices of the Chicago Mercantile Exchange, which allows for an arbitrated price and, therefore, small spreads for entry and exit, which, for Marcus, is “a very important issue when trading gold.” .

Likewise, another option to invest in gold is the ETFs, which are funds tied to the price of gold. “These are exchange-traded funds, which are like baskets of assets related to sectors, like gold, for example,” says Alonso.

Cryptocurrencies and CEDEARS

On the other hand, there are the cryptocurrencies tied to gold, which fall into the category of stablecoins and are a safer option than other assets in the crypto world. They are similar to gold funds and some of them are Pax Gold, Gold Mint or Tiberius (which is actually a mix of precious metals).

In Argentina there are also some brokerage houses that offer Common Investment Funds (FCI) tied to gold. And, finally, Alonso mentions that another possibility is to buy the CEDEAR (securities of companies from other countries listed on the local stock exchange) of a gold mining company, or a supplier in the gold sector, which will appreciate if the value of gold rises or the associated industry grows.

Source: Ambito

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