As gold (GC=F) spent the past week flirting with – and then hitting – new all-time highs, and there was a global uptick in online searches for “gold price”, market commentators are speculating there could be more price rises to come.
As a disappointing US jobs report came in, the yellow metal’s price surged once again on Friday, with futures contracts heading more than 1% higher to trade at the $3,650 mark.
With the excitement around commodities, mining stocks also got a boost, with the likes of Anglo American (AAL.L), Glencore (GLEN.L) and Fresnillo (FRES.L) lifting the FTSE 100.
As an investment, gold would have been a solid bet over the last year. Futures prices are more than 40% higher for the year-to-date outpacing gains for major indexes. Over the same period the S&P 500 (ES=F) is up less than 10%.
“This is looking like the third major bull run in gold since President Richard M. Nixon withdrew America from the gold standard on 15 August 1971 and, in the process, pulled the rug from under the Bretton Woods monetary system that had prevailed since the end of the Second World War,” said Russ Mould, investment director at AJ Bell.
“Gold bugs will therefore argue that there could still be more to come, given how the advance in this third bull phase still pales compared to the previous two.”
Experts have previously predicted that gold prices could climb even further. Analysts at Goldman Sachs expects the commodity to hit $4,000 next year.
“The outlook for the precious metal remains bullish, supported by expectations of Fed rate cuts, which are weighing on the dollar, and by heightened safe-haven demand fuelled by tariff uncertainty, concerns over political interference in the Federal Reserve, and lingering geopolitical turbulence,” said Ricardo Evangelista, senior analyst at Activtrades.
Gold falls under the category of alternative investments, named after their nature as alternatives to traditional investment assets such as bonds and equities. These can be anything from art to property, hedge fund investments, gold, and gold funds, and even digital assets.
When we think about precious metals, the first image that comes to mind is probably a gold bar or coin.
If you take this route, you are investing in the physical metal. Gold coins are popular, but primarily for collectors, as you will pay a premium for the design you might not get back. However, some coins become more desirable for collectors over time, so this gambit could pay off.
Read More: Four ways to invest in gold
