MyMoney Online

The ups and downs of gold...

It’s been exactly 12 months since financial fitness coach, Paul Roelofse, last spoke about gold as an investment option. Here are new insights.

Gold has always been a storage of wealth. The lustre of gold has attracted investors for centuries. Over the best part of the last decade, however, it seems to have lost its shine.

Peaking at levels around $1900 and ounce a few years ago to under $1100 of late. The big question is, “Will it be the safe haven when investors take flight from the stock markets and look for what has traditionally been their storage of wealth?

There are some very good reasons to consider gold as part of your portfolio.

The ups……..

There seems to be upside. It is has turned the corner from its low level in the $1000 an ounce range a year ago, to levels above $1200 presently. That’s around a 10% growth which points to a latent appetite for the precious metal, given the low returns and high risk in the markets over the same period.

The rand value of gold improves if our currency weakens. So if you are concerned about our rand sliding further into the abyss with all the political and economic problem we are facing, then you will certainly benefit.

The downs……..

The rand tends to surprise. Just when you think it is on a path to nowhere, it turns a corner, just like of late where it strengthened from R17,00 to the dollar heading toward R13,00.

Then just when we all thought it would break into range of R12,00 it spiked back up to mid R14,00. The currency is volatile which puts the investment of gold at risk.

Gold does not provide a yield. Therefore there is no opportunity for compounding returns into the future, which is how the growth on your investment is determined.

If you buy gold in the form of coins or exchange traded funds, then you rely entirely on the price movement and the currency differential. So it boils down to the rand price of gold over time.

Do your homework and take a longer view with gold. It does look attractive at the current levels given the aversion to risk which is taking place in the markets.

Listen to the full interview below for more information...

Read more from Paul Roelofse at www.investforlife.co.za

Read More
Unsure where to invest? These are the best shares right now (by Anchor Capital)

Unsure where to invest? These are the best shares right now (by Anchor Capital)

Sumitra Nydoo (on The Money Show) interviews Anchor Capital Analyst Henry Biddlecombe.

How accurate (or off the mark) stock pickers on The Money Show have been in 2017

How accurate (or off the mark) stock pickers on The Money Show have been in 2017

Bruce Whitfield grills three stock pickers he interviewed in January on the performance of their picks for 2017.

3 epic shares to buy right now (by Herenya Capital Advisors)

3 epic shares to buy right now (by Herenya Capital Advisors)

These are the three hottest investments you can make right now, according to Petri Redelinghuys.

3 best JSE investments in these recessionary times (by Truffle Asset Management)

3 best JSE investments in these recessionary times (by Truffle Asset Management)

The Money Show’s Bruce Whitfield interviews Truffle Asset Management Portfolio Manager Jonathan Du Toit.

Best offshore investments right now (according to PSG Wealth)

Best offshore investments right now (according to PSG Wealth)

Looking for a hot tip? The Money Show’s Bruce Whitfield interviews PSG Wealth Portfolio Manager Jonathan Fisher.

The magical rule of 72.

The magical rule of 72.

Weekend Breakfast's Paul Roelofse explains how the number 72 has an uncanny ability to calculate the future value of money.

Popular articles
Shocking claims of how Eskom deliberately caused 2008 and 2014 load shedding

Shocking claims of how Eskom deliberately caused 2008 and 2014 load shedding

Former Eskom employee reveals how the load shedding of 2008 and 2014 was “self-inflicted" by Eskom.

Double taxation looms for citizens working abroad

Double taxation looms for citizens working abroad

SA's new tax laws are pushing towards scrapping tax exemptions for South Africans earning a salary in foreign countries.

Sim swap scam: "They get the pin number and then clean out your account"

Sim swap scam: "They get the pin number and then clean out your account"

Consulting forensic scientist David Klatzow gives a detailed break down of the sim swap scam where criminals are hijacking phones.

Safety concerns at Newlands stadium

Safety concerns at Newlands stadium

They've been concerns around the safety of rugby fans attending rugby matches at Newlands Stadium.

International “one ring” phone scam can cost you big bucks

International “one ring” phone scam can cost you big bucks

My Broadband's Jan Vermeulen explains that as fast as the service providers block the numbers, new ones crop up.

13 random thoughts on living a happier, less materialistic life

13 random thoughts on living a happier, less materialistic life

Kabous le Roux shares 13 random thoughts he has on being less materialistic and living the good life right here, right now...