Wall Street traders suddenly turn very positive on gold stocks

Posted on 01 March 2015 with no comments from readers

If the US dollar is heading higher is that not bad news for gold? Not necessarily, these two currencies do sometimes trade in step as they are now.

The people’s desire for gold is eternal and is the most deeply embedded one. Gold is one among those metals that always holds a treasured value from past to present period and will continue to future. This is all because of its essential lustre and ductility. It is always regarded as a source of money despite all the natural calamities, wars or anything of that sort and is permanently tagged with the title ‘secure haven’ asset.

White gold has therefore always been the eye’s apple kind of asset for all the genuine traders as this could guarantee stable economic growth and offers an enhanced stock market. Moreover, the gold prices have always chosen to hit the markets almost all time.

You can continue reading this to find out the gold price deciding factors. Even though gold represents such a financial asset that has a global acceptance, it is one of the most difficult security to value.

  • Alternate to other commonly traded currencies, gold has no underlying infrastructure sort of support. It is rather found from beneath the ground and holds its respective physical properties.

 

While the gold price tends to fluctuate often, it is totally independent of the industrial supply and demand. However, nearly nine percent of the world’s gold is instrumentally used as it has good conductivity and anti-corrosive properties. The rest of the gold goes to jewellery or made for investing purpose.

 

  • Yellow gold has been rated on the levels of real interest rates or at low inflation stage. For example, if these real interest rates are actually low, then all other investment substitutes including cash and bonds give a declined return thereby forcing the investors to find ways to safeguard their wealth.

 

On the other hand, if the rates are high, the stable returns are assured in terms of cash and bonds and demand for industrial application gradually diminishes off.

Suddenly that has gotten normally anti-gold Wall Street traders very excited about the outlook for 2015, particularly for gold mining stocks that are leveraged to the price of the metal. That’s why are they all becoming goldbugs now. How is it best to trade this momentum play?


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Posted on 01 March 2015Categories: Gold & Silver, Sovereign Wealth Funds, US Stocks, Video Channel