It is a general tendency that the expensive things attract more than the
cheaper ones. And as per human psyche, commodities surrounded by myths tend to
be his ‘hot-favourites’ to talk on and speculate in. Such a commodity which is
among the top list of fondness is ‘Gold’. Ever since the civilisation began,
Gold have always been on this place of priority as a result of which, it has
been a controversial topic – to invest in gold or not!!
Check out these major myths that many minds have about this yellow metal:
Gold is overvalued always: This is a commonly debated
issue that the gold is an overvalued commodity. But in reality, there is no fix
price that one can claim to be the ‘right’ or ‘exact’ price of gold. Prices of
any commodity are a result of forces of demand and supply. What makes Gold more
popular is its long-term price stability, its liquidity and its evergreen demand
across the globe!
Investing in Gold stocks is more profitable than buying the Gold
itself: This is a common misconception among many people that trading
in real Gold is not as much profitable as its stocks! Dynamic stock market can
turn the table at any point of time, thus, brings along a lot of risk due to
which profitability cannot be ‘guaranteed’.
Gold investment is a game of sheer risk: Lack of knowledge
and unawareness land a person into misconception that investing in gold is too
risk. But actually, it is almost contrary to this fact. No matter how
fluctuating the gold prices are at one particular point or period of time, but
still in a longer run, it will always be the ‘safest’ of all other commodities.
So long term investments in gold are quite safe and profit-promising as even if
there is a price-fall, it will never be de-evaluated to zero.
Gold investment brings no divdend/interest pay-out: Yes it
is fact! Gold lying in your safe or bank locker does not bring any annual
dividend or monthly interest. Inspite of that, gold always has an edge over all
other investment options due to the ‘security’ and lesser risk. And not just
this, the significant price appreciation with almost ‘zero’ risk factor is what
makes this metal the wisest investment option.
Gold’s role in monetary term is insignificant: This is total
unawareness! Many people do not know that Gold today is used as a trading
currency alternative in many international trades. And not to overlook the fact
that Central Banks of many nations in the world keep gold reserves with them
which is approximated to be 25K tonnes!
Oil prices influence Gold prices: This major myth hardly has
any significance. Gold infact, in the recent past, is seen fluctuating along
with fluctuations in exchange rate of US Dollar which is conceptually farther
from Oil prices that are usually related to a healthy economic growth graph. Oil
and gold prices lie apart somewhere at the opposite ends.