The price of gold is now at an all time high - but it is still a good time to invest?
For centuries, the precious metal has been seen as the ultimate symbol of luxury and wealth.
A company might be doing well on the stock market today - but it could just as easily plummet in value or go bankrupt tomorrow.
Whereas the theory goes that people will always want to own a piece of gold - and that’s why the price has been surging in recent months.
“There’s a bit of a gold rush going on in China and what’s interesting is, for the first time, young people are buying gold in quite a big way,” Tara Coins owner Marco Byrne told Sarah Madden for The Pat Kenny Show.
Gold prices
“They’re buying little one gram [units of] gold… It’s Chinese consumers, it’s Chinese investors and it’s also the Chinese Central Bank - the People’s Bank of China.
“One ounce of gold is about €2,200 roughly right now and there’s 32,000 ounces in one metric ton of gold and the People’s Bank of China is buying roughly 15 to 20 metric tons every single month.”
Despite this, gold has never been quite as popular in Ireland as it is in most other countries.
“It’s interesting, in Ireland we don’t have a huge tradition of buying precious metals,” Mr Byrne said.
“There’s actually VAT on gold from the foundation of the State since 1922; so, straight away when you’re investing when you have money, you would look at property, you would look at land.
“The land became our gold in effect, we love the green fields and we love the property and that was our tangible asset, solid investment.
“I think that is slowly changing.”
Balanced portfolio
Money doctor John Lowe said it is always advisable to invest your money in a wide variety of assets.
“They say that 10% of your wealth should be in a precious metal,” he said.
“So, it acts as a kind of a hedge in times of economic instability.
“We’ve got all these wars, we’ve got recessions, we’ve got coronavirus and when those things kind of happen, they tend to look for something that’s really stable, solid and is not going to lose much value.”
Will prices of gold continue to rise?
On the key question of whether gold prices will continue to rise, Mr Lowe believes that it probably will - although there is no such thing as an absolute certainty when it comes to the future prices of commodities.
“I wrote about gold some 16 years ago when it was [worth] $1,660,” he said.
“I predicted even at that time that by 2010 it would be up to $2,000.
“Here we are in 2024 and it’s up to $2,369.
“The only way you can make money from gold is if it increases in value and the predictions are that by the end of this year it’s going to go to $2,652.”
Gold is not the only asset that has done well this year; in March, the price of crypto currency Bitcoin hit a record value of nearly $74,000.
Main image: Bars of gold bullion owned by the U.S. Government at the West Point Mint. 20 February 2014. Alamy.com
