Gold
Gold is the most important precious metal in the non-ferrous metal family. Due to the special characteristics of gold products, gold has been regarded as an important investment tools for a long time, and a necessary components in every investor’s portfolio. Due to the historical status of gold standard in the monetary system for the last century, gold has played the role of an inflation hedge and safe haven whenever the market confidence has turned weaker . During period of hyper – inflation, fiat currency will lose value and gold is one of the pseudo -currency that investors are willing to put their trust in.
Silver
Silver has occupied the second place of importance in precious metal, comes after gold . For thousands of years, silver has been used in decoration, manufacturing, trading purpose and has played a major role as reserve in monetary system.
Metals
Precious metals are non-ferrous metals such as gold, silver , platinum and palladium . Gold and Silver are the most frequently traded precious metals in both spot and futures market. Today, there’s enormous gold reserves in central banks of different countries as stabilizers to their financial system. Silver has also been regarded as a storage of value and used as a currency in history. Nowadays, silver is major precious metal in industrial usage and dentistry.
Spot Gold (or “Loco London Gold”) and Spot Silver ( “Loco London Silver” ) are traded 24 hours a day in the OTC ( “Over the Counter” ) market , through an international networks of financial institutions and banks . By employing leverage to trade on the spot market, Investors can take advantage of the rise and fall in gold prices and earn a profit by the price difference. The leverage is provided to the investors so that investors can be more flexible with regards to their employment of fund.
Factors affecting the prices
USD Trend |
USD Trend |
Oil Price |
Price changes in crude oil will trigger changer is gold prices . |
Inflation |
accelerating inflation rates can cause sharp rise in goldprices . |
World Gold Reserves |
changes in central bank reserves of physical gold . |
Political Tension |
Political Tension |
Supply and Demand |
varying supply and demand factors trigger the prices . |
varying supply and demand factors trigger the prices . |
gold and silver are important jewelry . |
Production Cost |
Bottom will hit when gold drops to production cost level . |
Global Financial Market |
there is interaction in financial Markets in general. |