Trading is one of many online business we can do, but what we gonna trade? making investment decision is the hard thing to choose on which we should invest our money, i suggest consider choosing gold, as we know, gold is a precious metal, but that's not the only reason why people choose gold trading. Here are 6 reasons why should start gold trading summarized from several sources.
1.) Inflation: Gold is known as a pretty good tool to fight inflation, because the price tends to rise. Simple analogy roughly like, 5 years ago we could buy bread at a price of 1000, but now the price is 3000. Here's Inflation causes prices to rise. So the value of money is also reduced. But, if you buy bread using a gold price of 5 years ago 1g, even now the price is still 1g to buy bread. There is a lot bread you can buy with it.
2) Deflation: Deflation usually causes a state of depression, which is the time when business activity and economic decline. At times like this, the value of gold tends to be stronger than the prices of other goods declined sharply.
3) Geopolitics. When the economic crisis and the 'political tension' price of gold is more stable than the country's own money. Sometimes even be the strongest compared to other investments. for example during the Iran and Iraq from 2007 to 2008. Because of the political tensions Market players will attract investment in the stock market, forex or bonds. They finally chose a safe investment such as gold, so the demand for gold goes up.
4) Supply is limited. Gold is a rare mineral and the numbers were a little bit and not be able to run like oil. Although not endless, but the circulation of gold is usually regulated at the central bank of each country.
5) Increased demand. Increased economies of developing countries into the cause of the increasing demand for gold. In many developing countries, gold is identical to a culture, one example is India. Why? India is one of the largest gold consuming world, India is also included in the most populous country in the World. Simple examples like this, in October usually a lot of Indian people stabbed and certainly a lot of use the jewelry for the celebration. Due to the large demand for gold, then the price will go up, for example roughly like that.
6) Diversified portfolio / asset. This last point is the reason investors to trade gold. The key to diversification is finding investments that are not too closely related between one and the other. Course of its history, gold believed to have "negative relationship" with stocks and other financial instruments. For example, in the 80's and 90's, is a good moment to buy stocks, not gold. But when back in 2008, it's time shining gold and stocks into the future bleak. That's why many people prefer gold.
Many people say "better make Gold investment, because prices continue to rise so not to lose". True, but we also have to remain in use trading strategies. So we've got the right timing when to Buy / Sell. And of course choose the legitimate company /broker for avoiding scam or loss.
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