Gold Trading Company: A Financial Overview

"Gold Advances After Federal Reserve Pledges to Keep Rates at All-Time Low," was the headline of a report published by Bloomberg’s Tony C. Dreibus and Madelene Pearson on August 10, 2011. The report further explains that the demand for gold has risen for the third time because of the US Federal Reserves’ pledge to keep its benchmark interest rate at a record low through at least mid-2013. ”As long as rates stay low, particularly U.S. dollar, it will help to support gold, if not push it higher in due course”, said Darren Heathcote, Head of trading, Investec Bank (Australia) Ltd.

With financial gurus becoming increasingly bullish about gold as an asset choice, almost every gold trading company has its hands full. Dave Rosenberg, who is the Chief economist and strategist at Gluskin Sheff Research, and one of America’s top five economists, says that gold’s continued rise is a consequence of shedding its precious industrial metal status and becoming a fully fledged alternate monetary asset. “Gold has reached platinum levels and is far outpacing silver because gold is now a currency and not an industrial metal subject to the whims of the global business cycle,” Rosenberg explained.

How a Gold Trading Company can Help

Change is an unavoidable part of our lives, but changes in the financial ecosystem can cause many to lose sleep and money. It is important to plan out one’s financials in such a way that any unprecedented financial volatility does not lead to losses. Even though prices of stocks and bonds change every day, any turbulence in contemporary politics and economics factors has a tendency to cause dramatic shifts. Investors are usually unprepared to handle the sudden drops in the market. Risk management can be initiated by developing a diverse portfolio of financial products. An investor should look across the complete spectrum of financial products, from gold stocks to physical gold itself. Physical gold has had a universal appeal across all regions and demographics. It is one of the few financial assets that are not simultaneously anyone else’s liability.

The world today is rife with global uncertainties, terrorism, the declining value of their dollar; all these are indicators of the declining value of consumer investments. In such an environment, the customer should try to preserve and increase one’s wealth through multiple ways. Gold is a store of value and is more durable than most metals. Gold can be easily liquidated and privately stored. A reputed gold trading company can help you diversify your portfolio. Such companies have vast experience in dealing with gold and gold related products. Joe Foster, one of the leading minds in the gold space and portfolio manager of the New York-based Van Eck International Gold Fund, says that precious metals are among the best hedges against financial pitfalls. “It goes back to the roots of human history. Gold and silver are a sound form of currency. They always have been,” says Foster. He goes on to add that the currencies of all major economies, including United States, are under severe pressure because of massive government deficits. "The more money that is pumped into these economies – the printing of money basically – and then the less valuable the currencies become."

The supply of gold has only increased marginally in the last couple of years. There hasn’t been any prolific discovery since the 1980s, when large volumes of gold were discovered in Australia and Nevada. Gold has reached record heights after the US credit rating was decreased by one level by Standard & Poor’s on August 5, 2011. This coincided with the European sovereign debt crisis and led to fears of another global recession.