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Why Gold Keeps On Rising

By Thomas Pline

An additional role gold plays is for purchasing power. Gold is used during production but the majority of the demand for gold comes from the use as a reserve.

The major exchange for gold although located in London is traded in us dollars with transactions taking place 24 hours a day over different time zones.

The price of gold is an important driver of the forex market. Known to be neutral as it is not tied to any one country like a currency is the price of gold fluctuates for various independent factors which makes it good for trading along with currencies.

Since being a reserve currency the price is closely related to other alternative investments such as currencies, equities, bonds or even oil. Another great aspect investors really like about gold is that during periods of low liquidity or even monetary or political unrest is that the price of gold tends to actually rise in value.

While the equity markets have been highly unstable over the last several years making both great gains and tremendous loses during the crisis the price of gold has been rising the whole time making large gains. Adjusted for inflation the price of gold is actually much higher than it was during the early 1980s highs.

The trend of gold has been up for the last six years has gold has risen from $330 to over $1,150 an ounce as recently as December 2009.

In the currency market, some investors also buy and sell gold for speculative reasons trying to make profits with small price fluctuations. However, the price of gold is very difficult to predict, since their use is mostly as a reserve of purchasing power, and therefore is subject to many monetary and psychological factors.

Investing with a short time horizon leaves open the possibilities for very large account gains however at the same it you have to be aware of your risks and be prepared.

Find the top rated forex system review and also look at a list of a forex broker comparison chart to find your best broker for trading forex.

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Topics: Investing | Comments Off

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Article Citation
MLA Style Citation:
Pline, Thomas "Why Gold Keeps On Rising." Why Gold Keeps On Rising. 12 Jul. 2010. uberarticles.com. 29 Sep 2014 <http://uberarticles.com/finance/investing/why-gold-keeps-on-rising/>.

APA Style Citation:
Pline, T (2010, July 12). Why Gold Keeps On Rising. Retrieved September 29, 2014, from http://uberarticles.com/finance/investing/why-gold-keeps-on-rising/

Chicago Style Citation:
Pline, Thomas "Why Gold Keeps On Rising" uberarticles.com. http://uberarticles.com/finance/investing/why-gold-keeps-on-rising/


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