Is it worth investing in Gold now?

Gold had a fantastic bull run during the current year (2009) and people started investing in this category apart from the normal Equity markets. I read an article in the Equitymasters, that the Gold's Bull run may continue in the future also. I earlier suggested that one should have Gold as part of their investment portfolio, as it will not let you down. The article is written by Porter Stansberry, chief of the leading US-based private publishing company, Stansberry & Associates Investment Research. That article gave various reasons, which is acceptable, for a bull run in Gold.

The key reason is that "it has future". With the Central banks busy printing currencies (lead by the US Fed), many experts now predict a return of Gold Standard. Porter himself has been a Gold Bull for a number of years. His current view is that "GOLD IS NOWHERE NEAR THE TOP". He believes this because the central bankers have began to buy gold during the last six months. Hence, he feels that the bull market for Gold has lot further to run.

My personal view on Gold is that it is a safe investment and gives a steady return, considering the fact that it has a ever-growing demand (both fashion, sentiments, government requirements etc.,). Have atleast 10%-15% of your investment in Gold. It can be either in the form of solid Gold or you can trade in the Gold Benchmark funds, which are traded in the stock exchanges.

All the best and happy savings for 2010 and beyond.



Nagaraj on Dec 25, 2009, 2:36:00 PM said...

I agree with your views Gopal, recommending to park part of one's portfolio in Gold.

Personally, I invested in Gold (24ct. and 22 ct.) in August 2009, when price of 22 ct gold was at INR 1,390 per gm. The said price shot upto Rs.1,725/- in early December 2009! Now some correction in prices is taking effect, and the price as on 24.12.2009 is Rs.1,570/-. I saw some article predicting price of gold expected to touch Rs. 1800/- to 2,000/- range in April 2010. So, I have plans to buy another lot when the price per gm touches Rs.1,500/-. If the price goes down further, next investment will be made when the price hits Rs.1,400/- per gm (August 2009 price) cost averaging benefit could be achieved.

Cochin, Kerala

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