Gold Bullion In Fort Knox

Gold Bullion In Fort Knox

Precious metals have retained their relevance, luster and even value for centuries. More often than not, investing in precious metals is a shrewd decision because their production is relatively lower than consumption. This means the supply and demand curve dynamics always seems to favor the market prices of precious metals.

Gold as a precious metal has become popular in modern times as more people become weary of regular economic meltdowns that affect the value of their monetary savings, bonds and stocks. There are several ways you can trade in gold including gold jewelry, gold certificates, gold currency and gold bullion among others. Majority of people are always unsure how to get the most out of their precious gold and they do not know whether selling your gold jewelry they own and buy gold bullion or not. So, should you cash out your gold jewelry and buy bullion

To Cash out Your Gold Jewelry and Buy Bullion Or Not?

This is the time to cash out gold jewelry and buy bullion. The most ideal time to invest in gold bullion is from the month of July to early October. This is because this is the time when bullion’ seasonal strength is highest. Trading in bullion has been lucrative twelve out of the last fifteen seasons.

Conventionally, the rise in the value of gold during this duration of seasonal strength is associated with the rise in demand for bullion by India’s precious metal fabricators who buy bullion with the aim of transforming it into gold jewelry in readiness for the Indian wedding season, which begin in the month of November. In addition, the recent rise in demand for gold by investors seeking to safeguard against devaluation of the rupee has also contributed to the rise in demand for bullion globally. This has contributed to good returns for those trading in gold bullion. Primarily, India is the second largest gold jewelry consumer after China. This means that, individuals stand to benefit when they sell off their jewelry and buy bullion, whose rising demand and value does not seem to stop any time soon.

Demand for gold has been rising in other countries such as South Korea, China and Russia among others whose central banks have been capitalizing on the low gold prices to buy as much bullion as possible to increase their holdings to diversify out of the constantly fluctuating Euros and dollars. This is a clear indication that the world is gradually shifting to gold standard and individuals who are shrewd enough to see the trend will take this cue to trade in their gold jewelry for bullion and sit back to wait and see their investments grow.

The low prices of gold witnessed in the recent past drove producers of gold to decrease their production, suspend establishment of new mines and even close down some marginal mines. This means that the supply of gold will continue to decrease until normal production resumes. This has already triggered a spike in demand and consequently the price and value of gold in the short and long term. In such a situation, it is more profitable to own gold bullion than jewelry, which means an individual is better cashing out their gold jewelry and buying bullion.

Therefore, if you wonder if selling gold jewelry, especially the items you will never wear again, and buying into gold bullion as in investment is a good strategy – my opinion is a strong yes.

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