Is gold a suitable investment?

Is gold a suitable investment?
Is gold a suitable investment?

Photo: EPA/BGNES

Gold has always been an option to save money from inflation as it is the only asset that is outside the financial system and allows people to own a real asset that is not someone else’s liability. The price of gold is not actually rising as people imagine, but rather the value of the currencies in which it is valued is falling. For this reason, it is a good hedge against inflation

This is what Max Baklayan, CEO of the Bulgarian division of one of the leading traders of precious metals and currency in Northern Europe, told BNR. The gold market seems stable at the moment, and the big panic from the beginning of the year because of the war has rather settled down, he commented.

“The main factor affecting the price of gold is the amount of money in circulation. We advise gold investors not to look at this asset as a short-term one – one that can deliver high returns in a few months. Gold is an asset that brings stability to your savings.”

“When there is uncertainty, people turn to gold and those are the times of higher demand and the price of physical gold rises significantly because supply cannot meet the significantly increased short-term demand,” he explained.

You don’t need a lot of knowledge to invest in gold. However, such are necessary when one trades an asset on a daily basis and tries to “ahead the market” and take advantage of its movement.

Investment gold is defined in law – 995 proof bars and over 900 proof coins, that is 99.5% pure gold in the bars and 90% pure gold in the coins Such gold can be bought from various merchants and some banks. Jewelry is not investment gold, even if it is of good quality.

The size of the appropriate investment is determined by the individual profile of the client.

The storage

“There are plenty of bank vaults and options that aren’t all that expensive. The fees and commissions you pay to a bank to keep your money there are no higher than what you would pay to keep it in a vault, and the risks are significantly smaller. In the last one year alone, the euro has lost over 15% of its value against the US dollar”.

Can we be fooled?

“Certainly, since these are products that in most cases the buyer, the customer will not have seen her and will see her for the first time in his life! If you choose not to make a deal with a disreputable merchant or online with some person directly, you may not get what you pay for. My advice is that people use the services of a reputable dealer who is regulated and has the necessary licenses.


The article is in bulgaria

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