With 2017 about to finish, the time is right to reflect on the performance of gold and silver through 2017. It is important to take this into account before we look at any predictions for the New Year. In order to assess the performance of gold and silver, and indeed analyse gold versus silver, we should take into account the spread between gold and silver. The spread is currently 78: 1. This means it takes 78 ounces of silver to buy one ounce of gold. When we analyse the recent performance of gold versus silver, we realise that this gap is widening. In the past year, gold has risen 10.48% (YTD), while silver has fallen -1.08%.
While silver has suffered more volatility in the past few months, the spot price of gold has risen steadily through the year to peak at almost $1350 an ounce in September. Since that peak, it has settled down to almost $1250 as we draw close to the end of the year.
Analysts believe that we could be on the verge of another macro-economic slump as geopolitical events around the world cause uncertainty in the global markets. There are fears that the euro and the pound could both slump, causing instability across the region. The pound is likely to suffer on the back of Brexit uncertainty, while political upheaval in Germany and a looming election possibility is causing uncertainty for investors when it comes to Europe’s economic stability.
Added to the mix is the threat of global terrorism and a deepening political crisis between North Korea and the US. All of these factors could start 2018 off on a shaky start, causing investors to withdraw from global markets and seek safer havens in gold and silver. Gold forecasts are looking positive as we move into a New Year and analysts are bullish on gold.
Fear may trigger the move to precious metals
Analysts from the global investment bank, Goldman Sachs released a report in November 2017 warning investors about the ‘unsustainable’ levels of US debt in the coming years. The US needs to put the brakes on its budget deficit in order to avoid going back to the debt ceiling crisis of 2011. However, if the US budget deficit increases in 2018, it could weaken the dollar, triggering an exodus of investors to precious metals as we witnessed in 2011.
The only big negative for precious metals is the Bitcoin Bull Run. If this trend continues in 2018, it would divert investments away from precious metals. However, the regulatory environment for crypto-currencies is looking murky as regulators around the world have started clamping down. China has officially banned Bitcoin exchanges and the Indian government has launched an investigation into the sources of money being used to fund Bitcoin trades. Speculation is rife in the market that India may soon follow suit and ban Bitcoin exchanges.
Talk to our experts if you want to invest in precious metals
2018 could start on a positive note for both gold and silver. However, in order to make well-informed decisions about how and when to invest in gold or silver, talk to our experts. At Physical Gold, we have been advising investors on investing in precious metals for years and our experts will be happy to help you out. Call us on 020 7060 9992 and get the right advice before you invest your money.
The Bloomsbury Coin Fair is a hugely popular event that is held 8 times a year in central London. With a highly affordable entry charge of only £2.00, it is a great place to visit and connect with the world of numismatists. It is a veritable treasure trove for those with a passion for collecting. They can not only see great coins first hand at the fair, but also connect with experienced collectors. There is plenty of advice available about coin investments and of course, the opportunity to browse catalogues and participate in auctions during the day. The Bloomsbury fair usually has around 40 dealers present and the owners of the event are John Philpotts and Sophie Dickenson, who are also responsible for running the show.
The fair is held regularly at the Bloomsbury Hotel, situated at 16-22, Great Russell Street in central London. Tottenham Court Road is the nearest tube station for visitors arriving via public transport. The hotel is a short walk away from the station. For those driving in, parking is available in a multi-storey car park down Great Russell Street or in the Bloomsbury Square car park.
Timings of entry are 9:30 AM to 2 PM. Exhibitors can also book tables to display their wares and do need to inform the organisers well in advance in order to ensure that a table will be available. Table prices range from £130 for a table 6 ft. long up to £250 for a 12-foot table. The fair covers many interesting periods in coin history. Visitors can find Tudor coins, Norman and Anglo Saxon coins and even coins that date back to Roman times and the Iron Age. A list of regular exhibitors can be found here.
Call us for helpful advice when you build your collection
There are many exhibitions across the world where collectors congregate to find out more about coins and gain knowledge about numismatics and investing. Of course, the Bloomsbury Coin Fair is one of the popular ones in the UK to attend.
However, expert knowledge is always helpful before you dash off with your hard earned money to a coin fair to make investments. You need to have deep knowledge about the subject before you put your money on it and this does not come easy.
The good news is that our experts at Physical Gold are always at your service to give you valuable advice, help you build your collection and even procure specific coins that you may want for your collection. Call us on 020 7060 9992 to talk to one of our experts who can help you learn more about numismatics and make the right investment decisions.
Yes, it’s almost Christmas, the most exciting time of the year. We’re sure you’ve already got those Christmas trees lit up in your homes, and if you haven’t, what are you waiting for? 2017 has flown by so fast and here at Physical Gold, its celebration time. We’re all getting ready to party with friends, families and loved ones and we’re sure you are too. We’re also looking forward to welcoming 2018 in a week after Christmas.
It’s been a good year for silver and gold. Silver spot prices have been fairly stable with a 52 week high of $18.64 and a low of $15.21. Silver surpassed the $18 mark in both February and April this year, spreading good cheer for investors. With a current spot price of $17.04 per ounce, the precious metal looks to be a hot favourite for investors looking for stability in their investments in the coming year.
For gold, it’s been an even better run in 2017. Starting well below the $1150 per ounce mark in January, gold rose steadily through the year and hit a 52 week high of $1357.38 in September this year. Settling down to the $1294 mark currently, the yellow metal may still rally one more time before the year is out. For numismatists, 2017 saw the issue of the lovely 2017 Silver Britannia and the amazing 2017 Gold Sovereign, a historic coin that heralds our Queen as the longest-reigning British monarch of all time. The 2017 Gold Britannia 1oz is also a great collectable, along with many other rare gold coins, all of which is available here with us here at Physical Gold. If you’re planning to invest over Christmas, look no further. A great starting point is our ‘how to buy gold’ guide.
With the Christmas lights up and running in every single town, we hope you’re making plans to be home, wherever you are. It’s indeed a magical time for all and if you want to make that magic 24 carats, all you’ve got to do is call. Right here on 020 7060 9992, Monday through to Friday, 9am to 5pm, we’re there to advise you. Call us and speak to our advisors about making some great Christmas gold and silver investments. You can also email us on [email protected]
Make this Christmas special. We’re sure all your gifts will spread joy and cheer to your loved ones, but there’s one thing we can assure you. Unlike many of the other purchases you make this Christmas, your investments in gold and silver will remain timeless. Have a wonderful Christmas and a happy and prosperous 2018.
Precious metals as an investment category have always attracted investors seeking to park their money in an asset class that behaves stably and does not have volatile highs and lows. Gold and silver are hot favourites for investors seeking to hedge their risks, find a safe haven and identify a stable asset class worthy of investment during periods of uncertainty in global stock markets.
The 2008 global economic crisis
A classic example is the period from 2008 to 2011. Spot prices of gold started rising from $870 in 2008. It continued to rise, finally reaching a record peak price of $1,895 on the 5th of September, 2011. This meteoric rise was fuelled by a number of factors.
The Eurozone crisis was clearly one of the factors that led to that rally in gold. A number of European countries defaulted on their national debt, starting with Greece. In quick succession, Portugal, Italy, Ireland and Spain joined the ranks. The spiralling debt crisis led global investors to believe that the entire European economy could be headed for a collapse. So, they hedged their risk by moving their money to precious metals. Similarly, during the 2011 debt ceiling crisis in the US, investors lost confidence in the American economy and turned to gold.
2018 and beyond
According to research conducted by Citi, gold prices were likely to rally into 2018 and beyond on the back of the current geopolitical crisis. These include military attacks, the threat of global terrorism and the political situation in North Korea. Citi analysts predicted that the spot prices of gold will rise upward of $1400 an ounce and remain there until 2020. The analysts believed that a global macro-economic crisis will be an outcome of the geopolitical crisis and investors will move to gold or silver. A rise in the prices of silver in 2018 was expected due to economic and geopolitical uncertainty, but also higher demand coming from the industrial sector.
2020 and the global pandemic
Despite studies conducted by the market pundits and precious metals experts, no one could predict the real impact of the 2020 global pandemic, which significantly boosted precious metal prices. The COVID 19 pandemic, which unfolded in early 2020 and accelerated quickly through the year, plunged the world into yet another economic crisis of epic proportions. Many of the leading economies around the world bore the brunt of lockdowns, shutting down of many businesses throughout the country. This resulted in complete economic uncertainty, falling interest rates and rising unemployment.
Many investors moved to precious metals during this period to protect their wealth against the impact of the pandemic. As a result, precious metal prices rose, and gold achieved its all-time high of US$ 2048.15 per ounce on 5 August 2020. Silver prices also rose to a seven-year high of US dollar $22.90 per ounce in July 2020. Although industrial demand for precious metals fell during the lockdown, so did production. Latin American nations like Mexico and Peru are responsible for approximately 2/5 of global silver production, however, mine shutdowns created scarcity for silver. Due to the overall escalation of precious metal prices, the gold-silver ratio also fell to 70:1.
So, if you’re interested in buying gold or silver as a hedge, or an investment or purely to diversify your asset base by adding a safe haven, it’s probably time to think and act upon it now. It’s also interesting to note that the historic COMEX spot price curves of gold and silver are almost identical. This means that gold and silver enjoy heightened demand at similar intervals. However, it’s important to note that the price ratio of gold to silver is 78:1. This means silver is more affordable and is often a precious metal of choice for investment portfolios.
Talk to our experts for advice on buying precious metals
At Physical Gold, our combined expertise over several years makes us an ideal choice for you to discuss how precious metals can be an important asset class in meeting your investment goals. You can reach us at 020 7060 9992.
We can help you purchase precious metals directly from our website. Our experts are always happy to advise you on what to buy and then walk you through the process of placing your order online. It’s simple and hassle free and we will fulfil your online order quickly, making it one of the easiest methods to directly acquire precious metals.
Precious metals such as gold and silver are a great way of diversifying your investment portfolio. If you’re looking for a solid longer-term investment that can act as a great safe haven against both drops in the stock market and inflation risks, then you may want to consider investing in silver.
What is silver stacking?
If you frequent investment forums or like to read online investment publications, then you may have already heard the phrase “silver stacking” before. For those who haven’t previously heard the term, it is generally used to describe someone who stockpiles silver, usually in the form of bars, coins or rounds. Anyone who collects silver in some form or another can potentially be classed as a silver stacker.
Silver is a popular choice for investors largely due to its affordability which allows investors to buy it in larger quantities. Coins particularly are a very popular way of buying silver as they are one of the easiest and most interesting methods of collecting. Unlike coin collectors, however, silver stackers rarely pay attention to particular dates or designs and are more interested in the amount of silver contained in the coins.
View our YouTube video “5 best silver coins to invest in”
Why the need to stock pile silver?
Silver, along with other precious metals such as gold and platinum, is often bought as a hedge against inflation. Many investors like to stockpile silver as it is a great store of value. In other words, it retains its value over long periods of time. Unlike paper money, silver has real value that isn’t dependent on government backing. This is one of the main reasons why it is such a popular investment. The more reliant we are on fiat currency and digital wealth, the more people will turn to tangible assets such as gold and silver to have a reserve outside of the system.
A lot of silver stackers like to set aside a certain amount of money to invest each month. This can help spread some of the risk involved with investing in what is still considered a fairly volatile asset. Instead of blowing large amounts of cash all at once and facing the risk of being hit by a drop in silver prices, they can buy in smaller amounts, as and when they have the money.
Growing demand and industrial use
Right now, the price of silver is historically low which is strange, especially considering there is so much growing industrial demand for the metal. New uses for silver are being found all the time and it is one of the most widely used metals on the planet. Sectors that are continuing to grow in importance such as solar energy and electronics/computer industry are increasingly turning to silver due to its many beneficial properties. Of all the metals, it is considered the best conductor of electricity, heat and light. With silver becoming such an important industrial metal, surely it is only a matter of time before it’s market price starts to reflect this as there is currently more silver being used on an annual basis than is being mined.
Why buy silver bullion?
Certain forms of silver such as Bullion coins can be bought CGT tax free which makes them an attractive investment for stackers. Here at Physical Gold, we specialise in silver bars and silver coins (such as Britannias). For more information on any of our products or advice on how to become a silver stacker, please give us a call on 020 7060 9992.
The World Gold Council (WGC) is an international organisation comprising several of the largest gold mining companies in the world including Barrick, China Gold and Newmont Mining Corporation. The main aim of the council is to further develop and maintain the continual growth of the gold industry through extensive promotion, as well as supporting research into new uses for gold.
A brief background and insight into the World Gold Council
The WGC was first established in 1878 and over the last century it has had a huge hand in making the gold industry what it is today. Bringing together many of the world’s most prestigious gold-mining companies, it was originally founded to help promote the global demand for gold and fuel consumer interest.
According to its website, the WGC is governed by a Board of Directors, who meet four times a year. The board is made up of four main committees, who together help shape the future of the gold industry around the world. The organization have several main offices based all over the globe including their main headquarters in London as well as central offices in New York and Shanghai.
Through their website, the WGC provide investors with a wide array of useful data and information including reports on the latest gold trends, consumer behaviour, real-time gold stock performance updates and an extensive library of interesting articles.
Responsible gold mining
Responsible gold mining is high on the list of the WGC’s responsibilities and the organisation are heavily involved in ensuring responsible and ethical conduct throughout the mining industry. The WGC was instrumental in developing the Conflict-Free Gold Standard, a process put in place to make sure that any gold being mined does not go towards funding any global conflicts or unlawful militia activity. They also support the International Cyanide Management Code which provides a framework for helping to reduce the amount of potentially harmful environmental impacts caused by mining.
Interesting facts about the World Gold Council
The World Gold Council’s symbol is made up of three gold rings. These rings are said to represent the “never ending circle of meaning,” and according to the council themselves are a reflection on how gold represented eternity to many ancient cultures. In the words of the WGC these three rings symbolize the past, present, and future of gold.
The WGC was responsible for creating the very first Gold Exchange Traded Fund (ETF) Launched in November 2004,the SPDR Gold Trust totally changed the way modern consumers invest in gold. The WGC initially spent just $14 million dollars developing the fund, which today is officially the 14th largest ETF in the world and has an estimated worth of $56.7 billion. The SPDR Gold Trust, ticker name GLD, is essentially a gold-backed exchange traded fund allowing investors to invest in gold bullion without the expense of paying premiums or storage costs. The GLD buys $30 million of gold daily and is the world’s largest private owner of bullion.
The WGC also helped set up the very first Gold Accumulation Plan (GAP) in China, along with the ICBC. (Industrial and Commercial Bank of China) The GAP is aimed at investors who want to invest a certain amount into gold on a daily basis. The benefit of investing in a GAP as opposed to a gold savings account is that it has a much lower minimum entry level, only requiring an investment of 1 gram per day. When the contract reaches maturity, investors can either renew it, convert it into cash, or exchange it for physical gold at designated branches owned by the ICBC.
Face Value: $50 USD
Gold Content: 1 ounce (31.104g) – Alloyed with Silver (3%) and Copper (5.33%)
Purity: 917 / 1000 (22 karat)
Gross Weight: 34.0500g
Coin Diameter: 32.7mm
First Year of issue: 1986
The American Eagle coin is a legal tender gold bullion coin of the United States and is an easy, convenient and affordable way to add to your gold portfolio. Authorised under the Gold Bullion Coin Act of 1985 the Eagle was first issued one year later with a face value of $50 USD. The American Eagle coin is the only gold coin whose quality and purity are guaranteed by the U.S. government. The US law dictates that the gold contained within the coin must come from sources in America.
Offered in 1/10 oz., 1/4 oz., 1/2 oz., and 1 oz. denominations, these coins are guaranteed by the U.S. government to contain the stated amount of actual gold weight in troy ounces. By law, the gold must come from sources in America, alloyed with silver and copper to produce a more wear-resistant coin.
The design of these coins is exactly the same as the one-ounce coins, except for the weight and value markings on the reverse. The series issued between 1986 to 1991 of the Gold Eagle has dates written with Roman numerals. However, this practice changed from 1992 onwards, and Arabic numbers were used to date Gold Eagles.
While these coins are generally accepted as legal tender by the US government, the intrinsic values of these coins are much greater than their face values. For example, the 2012 value of a $50 face value coin was as high as $1,835. Of course, these prices are heavily influenced by both market demand for the coins as well as the spot prices of gold.
It is important to note that the American Eagle coin is also available in silver. The silver versions of these coins are produced by three mints – Philadelphia, San Francisco and West Point. Featuring designs on its front and back by Adolph A. Weinman and John Mercanti respectively, the silver eagle remains a popular choice for coin buyers across the world. The first Silver Eagle was created in San Francisco in 1986 and rose to popularity ever since.
In order to commemorate the 25th anniversary of the Silver Eagle, the US Mint circulated a lacquered presentation set that contained five coins, one proof coin and one uncirculated coin from West Point, along with many other valuable Silver Eagles from different locations across the US, where they were struck.
In a recent development, the US Mint has announced that the American Eagle would now be available in palladium. This is the fourth metal that the American eagle would be available in, the earlier three being gold, silver and platinum. It would be the first-ever palladium coin to be issued on US soil. The coin has attracted global interest and has already notched premiums, well in excess of its face value.
Gold and silver American Eagle coins are a popular choice for investors and buyers across the world. These prestigious coins make an excellent addition to an investment portfolio. In fact, the silver American Eagle can be added to a person’s IRR account (individual retirement Account) as an investment allowed by US law.
The obverse side of the coin features a rendition of Augustus Saint-Gaudens Lady Liberty with flowing hair, holding a torch in one hand and an olive branch in the other. The reverse of the coin features a design by sculptor Miley Busiek of a male eagle carrying an olive branch to his family. The motto, “In God We Trust”, appears to the right of, and beneath, the eagle’s wing. This motto has featured on all U.S. gold coins since 1908.
Gold is wonderful, whatever you use it for. Let’s be honest you can’t own too much gold! So why is gold so beneficial? We pondered this question and have provided a detailed explanation of the many and varied benefits of gold investment on this page. There is a lot to discuss so we felt an infographic was ideal, this visual format conveys a lot of information in an easy to consume manner.
This infographic can be found immediately below. Underneath the infographic, we go into more detail to exactly why gold is so beneficial. Enjoy our gold benefits article!
Gold has endured centuries as a mark of wealth and the many benefits of gold investment begin with its simplicity. It is indestructible, relatively scarce and cannot be manufactured. It is a refreshing alternative to the complex investment products in the headlines today and is easy to both buy and sell. Infact gold is so simple it really is the one true global currency, that can be traded everywhere worldwide.
Watch the Physical Gold video – Gold investment as part of a balanced investment portfolio
The gold price is still considerably lower than its previous high, back in 2011/12. This provides the opportunity to buy significantly more gold now, than 8 years ago, for the same amount of money.
There’s a finite supply of gold in the world, which creates exponential price rises when demand increases. Production cannot simply rise to meet increased demand, so the supply/demand dynamic naturally drive prices higher. This also reduces the risk of devaluation, as lower prices then quickly attract more, new demand, which will once again fuel price increases.
Provides Portfolio Balance
One of the most popular benefits of gold investment is that it’s deemed to be a safe product, which investors have always turned to, in times of economic downturn. Its performance is apolitical and therefore independent of any one country’s policy agenda. It’s therefore perceived to be a hedge for anyone at risk of losses to their property value, ISA, stock portfolio, bonds, pension and also cash due to the effects of rampant inflation.
What can we learn?
History tells us that the financial world moves in cycles. In a period when one asset class performs well, another may yield losses. It is impossible, and far too risky, to try to call these exact cycles, by placing all your hard-earned money into one investment area. Instead, any Independent Financial Advisor (IFA) will recommend spreading the risk across the various asset classes, shifting the percentage of each holding according to the current economic conditions.
This way, an investor always owns a variety of assets, so any falls in one area will hopefully be offset with a different asset, producing good returns over the mid-term and maintaining balance. Owning physical gold actually reduces the overall volatility of a portfolio. In these current, uncertain times, experts believe up to 20% of holdings should be in gold, with perhaps 5-15% in better economic times.
No Counterparty Risk
In its physical form, the holder has no risk to any counterparty. This is particularly relevant in today’s new financial world, where the money is no longer even safe in a bank account. Investments in gold benefits also from avoiding the counterparty exposure that exists with investments in gold stocks, futures and options, which all have potential fraud risks.
Tax Advantages of Gold Investment
There are also great benefits of physical gold investment. There’s no VAT to be paid on investment gold. Also, unlike many other investments, there’s no Capital Gains Tax to pay on profits of UK Sovereign and Britannia coins, as they’re deemed to be legal tender. Tax relief of up to 45% is available on qualifying gold bars as part of a pension.
Gold is an internationally recognised, and trusted, a form of exchange and has been since ancient times. Therefore, the worldwide network of dealers can provide prices 24 hours a day for both coins and bars. To enhance liquidity, investors should invest in smaller and flatter gold bars. These can be easily sold to fuel short term-liquidity, which may be required for investments in other asset classes. For example, a one-ounce American Gold Eagle coin is a very liquid asset as there are usually a lot of buyers and it is easy to sell.
That’s not all…
While many people consider gold as a commodity, in recent times it is being labelled as a currency, as well as a hedge. While the popularity of stock markets has increased manifold, markets are very sensitive to every kind of macro-economic impact. Markets react to global incidents, such as political instability, terrorist attacks, etc. It is often said that markets defy logic at times and move only on emotion. Gold has a low correlation with the stock market and is therefore somehow insulated against market movements. True, gold can never go up in a sudden blaze of glory like a technology stock, but it is this lack of volatility and steady growth, coupled with liquidity that makes gold attractive to investors.
More than just a valuable investment, gold coins are part of the nation’s historical heritage and can be both beautiful and collectable. Many gold investors and collectors take great pride in their coin portfolios, often preserving them within their families for several generations. This habit also contributes to limited market supply, creating a numismatic premium and once again affecting gold’s value!
Beat cash in the bank
Investors worldwide are nervous about a possible new global banking crisis. The very fundamentals of banking have changed forever, with the perception of strength and safety now a thing of the past.
Several of our large high street banks are now partially nationalised. With interest rates and therefore savings rates, at all-time lows, returns on bank deposits are negligible or even negative. Simply saving money in deposits is no longer the safe haven it once was.
What’s the story?
Trust and faith in numerous major world currencies are at an all-time low. Concerned savers and investors are seeking a new, more reliable store of wealth and many have turned to gold. Simply leaving your savings in the bank and burying your head in the sand will not safeguard the value of your money. Proactive savers are now moving some of their money into gold, to reduce their exposure to traditional currencies.
Yet another factor to consider is the effects of inflation. Inflation slowly, but surely erodes the value of cash in the bank. Interest rates are at an all-time low. They have remained stagnant for the longest period in the UK’s financial history, as the economy struggles to stabilise. It is likely to remain that way for some time now as the Bank of England staves off imminent interest rate hikes year after year. The UK’s GDP growth is a dismal 0.4% and the economic uncertainty surrounding Brexit does little to help the situation. In this scenario of doom and gloom, inflation will eventually erode cash in the bank. Gold, on the other hand, provides investors with an excellent avenue to hedge risks associated with the slowdown of the economy. The Spot price of gold has steadily increased over the last ten years and it makes sense for investors to invest more in gold to escape the doldrums of the current economic situation. Moreover, there are fears of the US dollar performing badly in the coming year against the Euro and the Japanese Yen. Should such a scenario occur, we would surely witness a gold rally in 2018 as investors scramble to pull out of currencies and park their money in alternative asset classes. Gold, given its stability, would be the obvious choice, as would silver, which tends to mirror gold price movements.
Why not benefit from buying gold by contacting us?
We hope you have enjoyed our benefits of gold investment article and would encourage readers to consider making an investment. Why not call us today on 020 7060 9992 or send an email to discuss how gold investment would benefit your circumstances.
Common customer questions and our expert answers
What are the advantages of gold?
Gold can provide many benefits for investors, as well as offering obvious appeal as jewellery.
As a safe haven asset, gold tends to perform well in market uncertainty, so it provides unique diversification. In the form of gold coins and bars, gold holds an intrinsic value based on supply and demand, is VAT exempt and British coins are Capital Gains Tax-free.
What are the benefits of owning gold mining stocks?
Investing in gold mining shares offers the chance of greater returns than simply buying physical gold or gold funds. If the particular mining company outperforms its sector due to good management, cost controls or new discoveries, then price rises can be significant. You still benefit from the shares being linked to the underlying gold price. Gold mining stocks are also riskier than simply buying gold bars.
What are the benefits of wearing gold?
Gold has been adorned for centuries due to its rarity and beauty. The main benefit is that wearing gold demonstrates a degree of wealth, status and power. As a relatively soft metal, gold can be shaped into wonderful jewellery, with the wearer benefitting from expressing themselves with unique designs.
What are the benefits of the gold standard?
The benefit of the gold standard is to provide collateral to a currency. Because the gold back’s the money’s worth, and gold has a very limited supply, stimulus programs such as Quantitative Easing are very limited, protecting the economy from inflation. It provides a financial system with stability and discourages excessive government debt.
What are the health benefits of gold?
Consuming edible gold leaf and dust can provide anti-inflammatory health benefits to the consumer, can be used in surgery to repair nerves and blood vessels, and used in dentistry for crowns and bridges. Gold also offers a psychological health benefit of owning something valuable and has even been used to treat depression and migraines.
Benefits of platinum versus gold
In recent years, platinum has become cheaper than gold per ounce, so now offers the benefit of value. For jewellery, it is denser, so requires more metal for each design than gold. It is the preferred choice for resilience, but gold can be more flexible for unique pieces. As an investment, the platinum market is less established, so is less liquid with fewer coin and bar choices.
Contacting Physical Gold
We hope very much that you have enjoyed our infographic and supporting content relating to the benefits of gold. We know there is a lot to contemplate, so if you’d like a friendly chat about the topic why not give Physical Gold Ltd a call on 020 7060 9992 (Monday – Friday)? We can offer friendly advice on all aspects of the advantages of gold investment and what would be the best approach for you and your family based on your circumstances. Our full contact information is available here.
Daniel Fisher formed physical Gold in 2008, after working in the financial industry for 20 years. He spent much of that time working within the new issue fixed income business at a top tier US bank. In this role, he traded a large book of fixed income securities, raised capital for some of the largest government, financial, and corporate institutions in the world and advised the leading global institutional investors. Daniel is CeFA registered and is a member of the Institute of Financial Planning.
2017 has been another fascinating year for the gold industry. This shiny precious metal captures the imagination quite unlike any other commodity on earth and was never far away from the headlines.
1) Piano tuner discovers Britain’s largest ever hoard of coins
Back in April this year, news broke that the largest ever hoard of gold in British history had been discovered stashed in an antique school piano. The find has an estimated worth of £500,000 and contained over 913 sovereigns minted during the reigns of Queen Victoria, Edward VII and George V. Proceeds of the find were split between the piano tuner that found them and the piano’s current owners, Bishop’s Castle Community College, Shropshire.
Gold demand has generally been fairly languid across much of Europe in the last year but statistics published from a money metal article back in August showed that German and UK demand for gold ETF’s has risen dramatically in the last year and a half. Figures show that between Q1 in 2016 and Q2 in 2017 investment in German Xetra-Gold rose by 97 MT, whilst investment in U.K. Source Physical Gold rose by 38 MT. Investment in U.K. ETFS Physical Gold also rose by 31 MT.
This may be partly a reaction to Brexit and the fact that German citizens are worried about ongoing issues with the European Central Bank (ECB) with regards to money printing and bond purchases. There are also serious geopolitical concerns caused by the US imposing sanctions on Russian imports as a lot of Germany’s imports are from Russia.
3) London reveals how much gold is stored in its vaults
Data published by the London Bullion Market Association (LBMA) earlier this year revealed for the first time ever, exactly how much gold is being stored in Britain’s capital city. Figures published by the association revealed that around 7,500 tonnes of gold was held in London at the beginning of this year. This is the equivalent of 596,000 gold bars, or £227bn-worth of gold. 68% of London’s gold was held by the Bank of England who currently look after the UK’s gold reserves.
4) Germany brings home gold early
A surprising development in Germany this year saw the country send shock waves through the gold market, as they announced plans to recall all the countries gold currently being stored abroad, back to Germany by 2020. This involved moving nearly 400 tons of gold, worth around 30 billion, from the US and Paris back to Germany. Why this sudden decision? Many believe it shows Germany’s current mistrust of the US whilst others believe Germany may need it to back a new Deutsche mark, should the eurozone break up.
5) Global gold mining output in decline
We are still a long way off from running out of global gold reserves, but a new report by the GFMS team at Thomson Reuters this year revealed that total global gold production in 2016 fell for the first time since 2008. In total the world gold mine supply has fallen by 22 tonnes (3%) since 2015.
Contact Physical Gold
At Physical Gold, we pride ourselves on bringing you the latest gold industry news from the UK and around the world. To speak to one of our advisers about potential investment advice please call us on 020 7060 9992.
The market for precious metals has underperformed throughout 2017. Big things were expected from gold and silver this year and despite performing strongly early on, they didn’t reach the heights that were expected. Both gold and silver have picked up recently but overall it has been a relatively disappointing year for precious metals.
Metals expected to perform well in 2018
Despite a relatively underwhelming year from most precious metals, one metal that has performed particularly well is Palladium. This year prices for Palladium overtook platinum for the first time since 2001. Of course, there are no guarantees that Palladium will continue to perform well next year, however there are a lot of good indications. For one, production of Palladium is said to be in decline, particularly in Russia who currently produce around 41% of the world’s supply. As it stands Palladium is roughly 15 times rarer than its sister metal platinum, and around 30 times rarer than Gold. Other than Russia other large producers of palladium include South Africa and Zimbabwe.
There has also been an increase in the demand for Palladium from the car industry. This is due to consumers switching from diesel back to petrol cars amid government emissions warnings. Palladium is primarily used in catalytic converters for petrol cars helping to turn toxic gases and fumes into less harmful pollutants. The increase in demand for palladium is likely to continue into 2018 and whilst the emergence of electric cars could be a potential threat to the Palladium industry, we are still a long way off seeing electric cars becoming a proper rival to petrol.
Silver has had an indifferent year throughout much of 2017, however a lot of experts are predicting big things for the precious silver metal market in 2018. Currently the price of silver is relatively low despite a massive increase in demand across many industries, particularly solar energy. Production of silver is also on the decline and many people are predicting a big rise in its value if demand continues to outweigh production.
Gold was expected to perform extremely well this year but so far this hasn’t really been the case. Despite prices rising early in the year, gold prices have stayed fairly stable. With Interest rates in the /US expected to rise, gold is likely to take a hit early on in 2018 but many experts predict the metal will come back strongly towards the latter half of 2018 with prices expected to rise considerably.
Geo-political tensions and their effect on the market for precious metals
In times of political uncertainty, prices for precious metals – particularly
gold and silver, often tend to rise. This is because people are keen to store their wealth in tangible assets in the event that there should be a drop in the market. When prices for both gold and silver rose in 2017 it was generally due to geopolitical tensions such as Trump’s Inauguration and elections in Europe.
Looking ahead to 2018 there are several potential issues that could continue to cause economic instability. Brexit negotiations are still on-going which could potentially cause political conflict in Europe, although most of the cards are already on the table at this stage. Trump’s administration however, could still prove to be very volatile. US relations with Iran and North Korea are also very much in the balance and should things escalate then the economy may be affected. With so many global conflicts of interest still in the balance, our experts at Physical Gold are predicting a strong year for precious metals in 2018 as people look to store their wealth outside of the traditional system.
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