Gold Investment to Increase for the Fifth Year Straight

The Gold Yearbook, released by CMP Group is a comprehensive source of information and stats regarding the gold investment market. It has shown that investment in gold has increased every year since 2014 and it shows little sign of slowing down. 2018 could be the biggest year on record for gold investment, but what determines the price of gold and is it a sign that you should get on board with buying bullions?

What’s Been Happening?

2018 is expected to experience the largest increase in gold investment since 2016, when investment rose by 23.9% to hit 26.1 million ounces of the metal being bought by investors. This was followed in 2017 by a 14% increase in gold investment. This trend does seem to be slowing, with just a 6% increase expected by the end of this year. However, this is still the fifth consecutive year that investment has increased. Although annual trends are significant, the value of gold within each year is also important. The price of gold has been fluctuating, suggesting a volatility that shouldn’t be overlooked.

What’s Driving the Growth?

Investment in gold is largely dependent upon investors confidence in political and economic systems. With the UK voting to leave the European Union in 2016 and the election of Donald Trump that same year, there is great uncertainty among the general public. This has led to an increase in geopolitical tensions between the UK and US with countries such as Russia and North Korea. This could result in a military conflict or economic recession by 2019, so investors are abandoning traditional currency for precious metal such as mercury dimes, silver and gold. These will maintain their value even if currency tanks.

Should You Invest?

It is always recommended that you diversify your sources of income, so purchasing gold should only ever be in conjunction with other investments such as bonds, stocks and even cryptocurrency. The volatility of the markets means that you should be relatively confident in your knowledge of the markets and be sure to watch how political events affect prices.

The growth of gold investment is simultaneous with mass investment in cryptocurrency, such as bitcoin. This shows how political upheaval is forcing investors to diversify their assets beyond traditional stocks and shares. It is a mixture of fear and uncertainty which continues to drive the upwards investment in gold bullions.