The Federal Reserve Expands The Scale Of Quantitative Easing, Triggering A Gold Investment Boom

about

The price of gold went straight to $1300 / ounce.

In the second half of last year, we have to admit that gold is a kind of investment that we must not resist.

As a "hard currency" that can preserve value, its value can keep pace with inflation and prevent investors from shrinking their wealth.

The surge in gold is mainly driven by speculation that the Federal Reserve is about to expand the scale of quantitative easing, turning international investors' risk preference to gold investment boom again.

But many investors are surprised that the rise is expected, but so fierce, but many people expected.

international

Since the euro zone sovereign debt crisis has eased, gold and the dollar have begun to return to negative correlation. Gold prices depend on the face of the dollar.

The gold price has gained the biggest weekly gain since May, thanks to the weak market confidence in the US and further implementation of the quantitative easing plan.

Expert analysis shows that the weakness of the US dollar is the main driving force for the recent rise in gold.

Physical demand fell from countries and regions such as the Middle East, Turkey and India, but the number of short sellers increased.

September and October are typical jewellery demand seasons. A series of festival days in India will help to promote the sale of gold jewelry, while manufacturers in western countries prepare for Christmas during this period.

In addition, capital side factors also boosted gold prices further.

Global gold ETF changed its practice last month to reduce gold holdings.

Gold prices have risen 3.7% since the beginning of this month, and ETF positions have risen by 0.5%.

What is particularly noteworthy is that because of market fluctuations, central banks want to buy gold to diversify their foreign exchange reserves and boost their buying.

Data show that in July, Thailand increased its holdings of 500 thousand ounces of gold through the open market, an increase of 20%, increasing the holdings of gold to 3 million 200 thousand ounces.

{page_break}

According to market participants, gold is still in the long-term upward channel opened at the end of 2008 from the technical perspective, and technical buying may push the price of gold to the price that has not been touched above the record high.

Gold price is fierce: buying timing or departure signal?

In the face of the increasingly hot gold market and rising gold prices, how should investors choose? Frequent new highs foreshadowed increased risks, and the sharp drop of gold prices in the profit taking market was triggered or triggered. Warning whether Gold retail investors should leave the market in time, or that a bigger market is surging?

Gold is, after all, a hedging product, not the best investment product, and gold is not as rigid as other commodities. Therefore, when high gold prices are high, the general investors should consider evacuating gold investment. From the investment point of view, if the investment in gold futures, gold spot postponed, and other leveraged pactions, because of the aggravation of the price fluctuation, the risk will increase. The average person may not be able to bear it; investment in physical gold should take into account the risk of return and liquidity.

"The financial manager of the Hangzhou branch of Xingye Bank, which is responsible for the gold business, reminds investors who want to make profits in this market." recently, if gold is profitable, the risk of catching up is quite prominent.

"

The faster the price of gold goes, the bigger the profit margin, which means that the risk of callbacks is greater. There may be any technical return at any time. At present, the price of gold is still in a period of obvious concussion, and the possibility of continuing upward breakthroughs and rapid U-turn is very large.

Of course, the golden bull market in the past ten years has not ended and it is still a good investment variety, but the key is how to look at the gold investment.

After calculation, the price of gold has even reached a record high, but the actual price of gold is still far from the highest point of the previous bull market, indicating that the space is still very large.

But at the same time, we must see that the current international gold market is not physical demand, but capital operation. The demand for capital arbitrage will cause gold prices to fall sharply. Even if ordinary investors look at the golden trend, if they participate in trading investment, the risk is still very large.

"Fundamentals have decided gold futures are going to rise.

"Some experts believe that there is no need to rush out.

The key is "light storehouse to do more, steady investment", this is the high gold price of the winning way.

Ordinary investors do not have to worry about the short-term gains and losses of gold prices, but as medium and long-term investments, and at the right time, they use physical gold to "squeeze the bottom", thereby reducing the structural risk of household assets.

Short term bubbles can not hide their ability to resist inflation.

When the financial crisis hit, when the international gold price broke through the US $1000 mark for the first time, the gold bubble theory began to appear in the market.

Today, the price of gold has circled beyond "1000" and "thousand two", and has gone straight to the "three thousand three". In the market, the controversy over gold value and price is more and more rampant. The argument that gold is the most hard currency is also there.

However, despite the short-term bubble of gold prices, but the ability to resist inflation is not damaged. From the long history of development, the trend of gold rising still exists.

M Faber, a Swiss economist who had successfully predicted the collapse of US stocks in 1987, said: "if I were put in prison for 50 years, gold would be my first choice, because gold is the most honest currency in the world, and it can not be printed continuously by those less honest central banks, unlike banknotes.

"

As the only non credit currency in the world, gold is different from currency forms such as paper money and deposits. At any time, it will not lose its precious metal value, thus becoming the first choice to resist inflation and realize asset value preservation and appreciation.