Gold (GC=F) August futures opened at $4,210.80 per troy ounce on Tuesday, up 0.2% from Monday’s closing price. The price of gold moved lower this morning to $4,134.90 per troy ounce as of 8:42 a.m. ET.
Gold prices appear to be losing some steam this morning after a stronger opening than on Monday. While peace talks appear to be progressing between the U.S. and Iran, future Fed pricing is driving some investment banks to reassess their gold price expectations for the year:
Bullion is now seen at $4,300 an ounce in the third quarter, down by more than a fifth from the prior outlook, and $4,800 in the final three months, down by 17%, Michael Hsueh, a research analyst, wrote in a note. Both of the revised targets still imply prices are expected to gain from current levels near $4,140, although they are markedly less bullish than before.
Deutsche Bank’s less optimistic outlook echoes a move last week by Goldman Sachs Group Inc., which chopped $500 an ounce off its year-end forecast to $4,900 as it now sees no rate cuts by the US central bank this year.
And if the Fed cuts rates multiple times this year? Hsueh said the price of gold could dip to about $3,800.
Keep reading: Deutsche Bank Cuts Gold Forecasts up to 22% as Bulls Temper View
Current price of gold
The opening price of gold futures on Tuesday was 0.2% higher than Monday’s opening price. Here’s a look at how the opening gold price has changed versus last week, month, and year:
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One week ago: -2.3%
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One month ago: -6.8%
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One year ago: +25.1%
The precious metal’s one-year gain was 95.6% on Jan. 29.
24/7 gold price tracking: Don’t forget you can monitor the current price of gold on Yahoo Finance 24 hours a day, seven days a week.
Want to learn more about the current top-performing companies in the gold industry? Explore a list of the top-performing companies in the gold industry using the Yahoo Finance Screener. You can create your own screeners with over 150 different screening criteria.
Learn more: Who decides what gold is worth? How gold prices are determined.
Risks and considerations for gold investors
Gold has the same high-level risk as any investment: You could lose money. And, as with other investments, a loss on gold can materialize in different ways. Understanding the potential outcomes is the first step to managing your risk when investing in gold.
According to gold experts, would-be gold investors should understand these four risks:
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Price
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Speculation
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Opportunity cost
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Fraud
Today, we’ll focus on the first two: price and speculation.
Learn more: How to invest in gold in 7 steps
Price risk
There is a price risk for investors who buy gold when the metal is nearing record high prices. “Buying high to hope for short-term higher is a tough strategy,” said Darrell Fletcher, managing director, commodities at Bannockburn Capital Markets.
Despite the high prices, there are positive dynamics in play for the precious metal. Fletcher pointed out that gold is recovering from decades of low prices, and it’s an increasingly popular diversification asset for central banks and individual investors.
The right expectations, a long timeline, and an appropriate allocation can limit your pricing risk. “Gold should not be seen as a driver of supercharged returns — it’s there to act primarily as a stabilizer in a diversified portfolio,” explained Alex Tsepaev, chief strategy officer of B2PRIME Group.
If you are interested in learning more about gold’s historical value, Yahoo Finance has been tracking the historical price of gold since 2000.
Speculation risk
Thomas Winmill, portfolio manager at Midas Funds, encourages investors to view positions in gold bullion, coins, and ETFs as speculative. Gold is a commodity, and “commodity prices are dependent on macroeconomic, political, industrial, and financial factors that are unpredictable, and in some cases, unknowable.”
Despite its recent performance, gold is an unpredictable asset. Keeping that in mind when making trading decisions could protect you from over-exposure and unrealistic expectations.
Learn more: Thinking of buying gold? Here’s what investors should watch for.
Price of gold chart
Whether you’re tracking the price of gold since last month or last year, the price of gold chart below shows the precious metal’s change in value.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: finance.yahoo.com
