Gold’s value is more than just its price
As one of the few assets which holds its value during turbulent economic times, investors often sell gold in order to raise liquidity to meet actual and potential margin calls in other sectors. Research conducted by the World Gold Council shows that gold has a vital role to play as a protector of wealth within portfolios, not solely as a liquidity asset, a role very much in evidence during the course of October 1987. During this period, according to our research, investors would have gained or saved between $22,000 and $178,000 for every $10 million invested by holding 3% to 6% of their portfolio in gold.
Euro Crisis: Central banks bullish on buying gold
Central banks say they see buying gold and silver as one of the preferred asset classes in 2012, spurred by worsening fears over the Euro zone crisis according to a new survey from Swiss Investment bank UBS.
Central banks as a group bought 455 tonnes of gold bullion last year and have continued buying gold in 2012.
Does Gold keep up in hyperinflation?
While there can be multiple reasons for inflation, hyperinflation historically has one root cause: excessive money supply. Debts and deficits reach unsustainable levels, and politicians resort to diluting the currency to cover their expenses. It’s no secret that many currencies around the world, including the US dollar, are choosing the path of inflation. If we were to slip into hyperinflation, there will be disastrous consequences for those unprepared. Given that the US dollar is the world’s reserve currency, the problems would spread to practically every country on earth. Hyperinflation will shake people’s confidence not only in the US dollar, but in the paper currency system as a whole. Gold and silver may be the only viable options left standing. The investment implication is obvious: continue to accumulate gold.
Hedge Funds boost bullish bets on silver as stimulus pressure rises
Wagers on higher bullion prices rose for a third week, the longest increase since February. Net-long positions climbed 1.3 percent to 99,684 contracts, the highest since May 1, CFTC data show. Bets on higher silver prices gained 12 percent to 7,312 futures and options, a six-week high.
Gold rose 3.8 percent this year, after 11 straight annual gains. Investors are buying the metal as a hedge against inflation, speculating that global stimulus measures will devalue currencies and increase consumer costs.
Canadian Bullion Services was established in order to provide individuals and businesses a vehicle to invest in four precious metals. The four precious metals we focus on are: Gold, Silver, Platinum and Palladium. Our team of specialists have combined over 40 years of experience in the industry. This knowledge will help you make better decisions on how to allocate your assets and when to buy and sell.
Canadian Bullion Services
55 Eglinton ave East, Toronto, ON M4P1G8