Is Now The Best Time To Invest In Gold,check If It Is The Best Time To Invest In Gold In 2015
Tue, Mar 12, 2013
When Is The Best Time To Invest In Gold
Gold is going through one of its sharpest corrections in years.
That’s actually the good news.
The bad news is there’s no short-term sign of a turnaround either.
Hedge funds, which tend to jump on trends up and down and make for higher highs and lower lows, are the most bearish they’ve been on gold in more than four years. The total short positions in gold (essentially bets they place on the price of gold going down) from hedge funds have reached their highest point since 2008.
If they keep piling in, the short-term price of gold will continue to slide.
None of this should be surprising. In our forecast for a gold price turnaround we stated to keep an on inflation (which is slowing due to a slowing economy) and nominal interest rates (which have risen recently) to determine the real rate of interest.
After all, the real rate of interest is the real driver of gold prices both up and down. It’s also key determinant if it is good time to invest in gold.
So the current downtrend will require a significant turnaround in those fundamentals to know when the gold price trend will take a turn.
Until then, there will be plenty of opportunity for gold investors to capitalize on what’s likely going to be a great time to invest in gold.
For now, here’s how to know when will be the best times to invest in gold.
The Three Best Times to Invest in Gold
Best Time to Buy Gold #1: Now
Fundamentally, gold has many qualities. One of its primary purposes is hedge against inflation. Another purpose is as insurance against an all-out economic collapse. Gold has never lost all of its value. It has never been worth zero. And in the event of a global economic calamity, gold will still be worth something and could potentially be worth far more than it is now.
As a result of the insurance feature, gold has a place in every investor’s portfolio. So if you don’t have any gold, makes now a good time to get some. It’s readily available. You can buy gold bullion at any coin dealer or reputable online coin dealer and receive it in a matter of days. In a true economic catastrophe, that will not be the case.
Best Time to Buy Gold #2: Market Meltdown
It’s no secret your editor is not in the long-time “gold bug” camp.
Yes, we first bought silver in 2001 when it fell to multi-decade lows. But we’re hardly the gold “must go up” crowd.
In fact, when gold prices go down, we believe it’s because of fundamental mix of inflation and interest rates and not some international conspiracy led by wealthy bankers of a certain religious heritage.
But we do know an opportunity when markets hit extreme highs and low. So when the markets were collapsing in 2008, gold fell below $800 an ounce, and the Fed announced it would print trillions of dollars to “save the economy,” we knew gold prices were inevitably headed much higher.
We bought gold, gold stocks, and silver aggressively and recommended to everyone we knew and published extensive research on why it was the good time to invest in gold in years.
There will be another market crisis eventually. There always is another one. It will likely be a surprise when it comes. And that, just like every other financial crisis, will likely present another great time to buy gold.
Best Time to Buy Gold #3: Inflation Rising or Interest Rates Falling
If you’re a new reader to Contrarian Insights, you’ll get sick of hearing this. But it will pay for itself many times over in the years ahead. So it will be worth it.
The only thing that affects gold prices over the long term is the real rate of interest.
There are short-term ups and downs and they are unpredictable. Keep an eye on the trends in inflation and the rate of interest on bonds. They will help you pick up gold before it starts to rise and sell or hedge before it falls.
Right now interest rates are just off their historic lows. The 10-Year Treasury bond yielding less than 2% interest doesn’t have much to fall.
Meanwhile, inflation is slowing down significantly. One of the biggest factors affecting inflation is the strength of the economy. It’s a concept involving the velocity of money and greatly reduces the money supply when the economy slows. Right now the economy is slowing.
when is the best time to invest in gold ? when these two trends start to change and nominal interest rates start to fall or inflation picks up.
As you can see, there are many different times for investors to buy gold.
It really depends on the purpose of the gold investment. If it’s for crisis insurance, now is a good time to invest in gold. If it’s for investment purposes to protect against inflation or earn a return on investment, right now is a good time to invest in gold .
Over time there are Good time to invest in gold and there are great times to invest in gold. Right now it may be a good time to buy gold, but prevailing trends show the best time to invest in gold
in years may not be more than a few months away.
Executive Editor, Contrarian Insights
The Group of Big Investors in United States.
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