Throughout history, few instruments have matched
Gold in its reputation as a safe-haven, whether it is inflationary issues, economic outbreaks, currency fluctuation, or geopolitical conflict. Safe-haven assets such as
Gold are meant to diversify an investor’s portfolio and are crucial in times of market volatility. While such systemic risks in the market are inescapable, investors tend to run to safe-haven assets that are uncorrelated or negatively correlated to the overall market during times of instability.
So, Let’s Talk Gold
In
2008, when the global financial crisis struck, equity markets crashed, fixed income became one of the riskiest instruments to invest in—while
Gold gained
57% from the year before.
Three years later, the same scenario repeated in
2011. The world's largest central banks struggled to find the right recipe of interest rate and stimulus to control inflation levels. And then again,
Gold bulls benefited from more than an
80% increase in
Gold prices since 2008.
The Global Pandemic
A decade later, a virus that not only impacted our health but also the global economy. In
2020, countries all around the world enforced a lockdown: companies shut down, unemployment rates increased severely, prices went rocket high, trading cycle disrupted, and energy cost became a burden. Yet,
Gold continued to shine. Prices increased by
33% from the previous year's high to a new all-time high at
$2,089 in August
2020.
Will The Golden Cycle Continue?
Although past performance is not necessarily indicative of future results.
Gold has continued to shine during all the global economic turmoil in 2008, 2011, and 2020.
Therefore, should we consider
Gold to continue its rise, and hit an all-time high, and sustain those levels or is it doomed for a severe correction when central banks start their corrective action?
Take the opportunity and start trading Gold with tightest spreads in the industry from only $0.07 with
MultiBank Group
