WHAT IS MEANT BY GOLD INVESTMENT

Gold Investment is about generally buy gold as a way of diversifying risk, especially through the use of futures contracts and derivatives. The gold market is subject to speculation and volatility as are other markets. Compared to other precious metals used for investment, gold has been the most effective safe haven across a number of countries.

GOLD PRICE:

The price of gold is moved by a combination of supply, demand, and investor behavior. That seems simple enough, yet the way those factors work together is sometimes counterintuitive. For instance, many investors think of gold as an inflation hedge. That has some common-sense plausibility, as paper money loses value as more is printed, while the supply of gold is relatively constant. 

Hug says the big market movers of gold prices are often central banks. In times when foreign exchange reserves are large, and the economy is humming along, a central bank will want to reduce the amount of gold it holds. That's because the gold is a dead asset unlike bonds or even money in a deposit account, it generates no return.

HISTORY OF GOLD:

In order to fully understand the purpose of gold, one must look back to the start of the gold market. While gold's history began in 2000 B.C, when the ancient Egyptians started forming jewelry, it wasn't until 560 B.C. that gold started to act as a currency. At that time, merchants wanted to create a standardized and easily transferable form of money that would simplify trade. The creation of a gold coin stamped with a seal seemed to be the answer, as gold jewelry was already widely accepted and recognized throughout various corners of the earth.

 Its importance continued to grow throughout Europe and the U.K., with relics from the Greek and Roman empires prominently displayed in museums around the world, and Great Britain developing its own metals-based currency in 775. 

Personal savings has an important role to play in the economy of any country. Savings and Investment is considered as a powerful tool in eradicating poverty. To invest means to allocate money or other resources with the hope to get a benefit in the future. This benefit we call ‘Return’. Investors generally expect higher return from their investment. There are numerous asset classes or investment avenues for an investor in this globalized economy.