Economic fluctuations, geopolitical tensions, and a volatile stock market are just a few of the catalysts that send investors scurrying to safe havens. More often than not, gold emerges as one of the more popular assets that outperform during periods of uncertainty.
But just how much is a gold bar worth in 2024?
As at the time of this writing (February 12th 2024), one troy ounce of gold (XAUUSD) is estimated at $2,021. A typical gold bar weighs around 32 troy ounces, which means a single gold bar costs around $64,672.
Gold as a safe asset
Gold has an illustrious history of being a safe asset, sought after during times of economic uncertainty. It doesn’t corrode, doesn’t tarnish, and it has no “default” on the promise. Over time, gold has been an anchor, a benchmark for measuring any country's currency. In the digital age, the concept of safe-haven assets has only grown in importance.
Why miss out on the commodities market's potential?
Discover the untapped opportunities in top traded commodities CFDs like gold, silver & oil.
What influences the price of gold?
The price of gold is influenced by a myriad of factors:
- Supply and demand: The balance between supply (from mining, recycling, and sales from gold-holding institutions) and demand (for jewellery, technology, investments, and central bank reserves) plays a key role in determining gold prices.
- Inflation: Gold is often seen as a hedge against inflation. When inflation rates are high, the value of currency decreases, but the value of gold tends to increase.
- Economic uncertainty: During times of economic instability or uncertainty, investors often turn to gold as a "safe haven" asset, which can drive up prices.
- Interest rates: Interest rates and monetary policy set by central banks can affect the price of gold. When interest rates are low, investment in gold becomes more attractive, driving up its price. But when interest rates are high, gold prices may fall as the returns on savings and investments in high yielding currencies rise.
- Currency fluctuations: Gold is priced in U.S. dollars, so when the value of the dollar decreases compared to other currencies, it often leads to an increase in the price of gold.
- Investor behaviour: The behaviour of investors, including their perception of gold as a safe investment and their reactions to global events, can also influence gold prices.
- Global jewellery and industrial demand: The use of gold in jewellery and industry also impacts its price, with increased demand leading to higher prices.
Buying gold bar vs gold bar CFD
For investors looking to tie their fortunes with gold, two paths diverge. The first is the traditional route of buying and physically owning gold, which is the epitome of permanence and solidity. The second, and a more modern approach, is through trading Gold Bar CFDs, a derivative that mimics the gold market without the need for physical ownership.
A step-by-step guide to trading Gold bar CFDs
- Sign up with Skilling : If you don’t have an account yet, sign up with Skilling, an award winning CFD broker for free.
- Choose your market : At Skilling, you have the choice of trading gold CFDs against the USD (XAUUSD), EUR (XAUEUR) or AUD (XAUAUD).
- Analyse the market : Utilise Skilling’s comprehensive market analysis tools to assess the trends and decide on your trading strategy.
- Position sizing : Set the right position size. CFDs allow for flexibility, but always trade within your means.
- Enter and exit : With your strategy in place, enter the market. Skilling’s user-friendly platform makes executing trades as easy as a few clicks.
- Monitoring and adjusting : Once in, monitor the trade closely and make adjustments as necessary. Setting stop-loss and take-profit orders is a smart risk-management move.
- Study the outcomes : Win or lose, every trade offers a lesson. Study the outcomes to refine your approach for the next opportunity.
FAQs
What causes the value of gold to rise?
Gold’s value can climb for various reasons, such as a weakening currency, inflation, geopolitical uncertainty, and as demand for its ‘safe haven’ status increases.
Can I take physical delivery of gold if I buy a gold bar CFD?
CFD traders don't take physical delivery of the underlying asset. Instead, they aim to profit from the differences in gold’s price movements.
Is gold a good investment in 2024?
The decision to invest in gold depends on various personal and market circumstances. Investors often flock to gold during times of market volatility and geopolitical uncertainty. It is a resilient commodity but, as with any investment, comes with its risk assessments.
Experience Skilling's award-winning platform
Try out any of Skilling’s trading platforms on the device of your choice across web, android or iOS.
