Current Gold Price: September 6, 2024

Gold is an asset that many people like to own as a hedge against inflation. While rising prices tend to erode the purchasing power of currencies such as the U.S. dollar, gold generally appreciates in value over the long term. Holding gold, such as in a Gold IRA, can help investors preserve the value of their portfolios, build wealth, and hedge against volatile markets.

“Gold has intrinsic value and tends to retain that value over time, making it a stable store of value in times of economic uncertainty,” said Denis Shirshkov, a finance professor at the City University of New York. Gold can also be a good investment because it’s a liquid asset that can be “easily bought and sold on the market,” according to Shirshkov.

Gold price history

Gold is a popular asset as a hedge against inflation. When commodity prices rise, the purchasing power of the US Dollar and other currencies often declines. In such cases, the value of gold typically increases over time. Investing in gold allows individuals to preserve the value of their portfolio, grow their assets, and protect themselves from market fluctuations.

Over the very long term, gold’s average annual return will be significantly lower than stocks. From 1971 to 2024, the stock market achieved an average annual return of 10.7%. Gold’s average annual return over the same period was 7.9%.

What does “spot gold” mean?

Spot gold prices represent the instantaneous rates at which gold can be bought and sold over the counter. By monitoring the spot price, investors can gauge investment trends and demand for gold. A higher spot price indicates higher demand. Unlike futures contracts, which are agreements for future transactions, the spot price pertains to an immediate sale.

The spot price can be higher or lower than the futures price. When the spot price is lower, it is called contango and it often occurs with commodities that have high storage costs. Conversely, when the spot price is higher than the futures price, it is called backwardation. Analysts suggest that the market price will eventually match the futures price.

A variety of factors, including supply and demand, affect spot prices, which are constantly fluctuating, and investors should be prepared for continued price fluctuations when investing in gold.

What is the price spread in gold trading??

Price spread refers to the difference between the price at which you can buy an asset and the price at which you can sell it.

Gold works in a similar way. The offer price, or sell price, is the amount you need to pay to buy gold and represents your investment cost. The bid price is the amount you will receive when you sell your gold. The bid price is always lower than the sell price.

Tighter spreads indicate greater liquidity in the market. Smaller spreads should give investors peace of mind as they indicate greater demand for gold.

How to invest in gold

According to fee-paying financial advisor James Tasker, gold can be purchased both as a physical asset and as a securitized product. “There’s a fierce debate about whether paper gold is as useful as physical gold,” he says. “From a financial advisor’s perspective, it’s much easier to adjust a client’s gold allocation if they hold gold as an exchange-traded fund (ETF), and the spreads when trying to buy and sell gold can be quite volatile and wide.”

There are many ways to buy gold. You can even create a Gold IRA. Here’s how to invest in gold:

• Gold Bars: Also known as bullion, many investors choose this option when investing in gold. Gold can be purchased by the gram or ounce, with the purity, weight, and manufacturer stamped on the surface of the bar.
• Gold coins: These are collectible coins, such as the American Gold Eagle coin. Because they are collectible coins, they can fetch a premium price above their weight in gold.
• Gold jewelry: Since people also buy gemstones for their aesthetic value, their price can be significantly higher than their weight in gold.
• Gold futures contracts: A futures contract stipulates that an investor will purchase a specific amount of gold at a specific price on a specific date in the future. Futures contracts allow investors to speculate on future gold prices without dealing in the actual physical product.
• Gold Fund: These are mutual funds or ETFs that hold gold assets. You can buy shares in a gold fund or other mutual funds, the value of which will fluctuate based on changes in the underlying asset portfolio.

Is now a good time to invest in gold?

“An allocation to gold should really be considered on a case-by-case basis,” according to Tasker, but Shirshkov noted that “diversifying your portfolio with gold can help reduce overall risk and volatility.”

Living in an era of inflation has many investors looking to diversify their portfolios with gold. Many believe that gold brings stability during times when the stock market is very volatile. Since the recent surge in inflation, prices have risen to all-time highs, and JP Morgan expects prices to continue to rise to an average of $2,500 per ounce by the end of 2024. Many experts agree that now is a good time to diversify your portfolio with gold.

Current Precious Metals Prices As of 9am ET today

Along with gold, silver, platinum, and palladium are popular precious metals that investors hold in their portfolios. In terms of volatility, gold is less volatile than silver, which can fluctuate more in price on any given day. However, silver is more sensitive to economic changes since it is widely used in many industries.

Platinum and palladium are also widely used in industrial applications. Investing in these rare metals is another way to diversify your portfolio, but these metals are highly volatile, which can provide investors with the opportunity to make speculative profits.

summary

The US economy has been in a state of uncertainty for the past few years, with inflation impacting every household. Investors can use gold as an inflation hedge for their portfolio. There are many ways to buy gold, making it easy to accumulate assets based on an investor’s comfort and interest. Gold can be purchased in an IRA or non-retirement account, and it suits both short-term and long-term investment objectives.

FAQ

What is the best way to own gold?

More and more investors are buying gold through ETFs, which allow for a managed portfolio of easily tradable assets.

Is gold a good investment?

For investors looking to diversify their portfolio and hedge against inflation, gold is a good investment, and there are many ways to buy gold, making the investment easily accessible.

Should I buy gold coins or gold bars?

Gold coins are considered collectibles and can be worth more per weight than gold bars. Their collectibility and historical importance may make gold coins a more attractive asset to some investors.