Profit and Loss of Gold Investment That You Need to Know | OBROLANBISNIS.com — In times of economic turmoil, gold is the right choice of “safe haven” investment asset. Moreover, the gold investment process can also be done in a more practical way, namely through digital channels.
But, make no mistake, apart from the many advantages of gold investment, there are a number of disadvantages of investing in precious metals that also need to be considered. Therefore, gold investors must still diversify their investment portfolios.
Here are 7 things to consider before investing in gold:
1. Gold cannot generate passive income
Deposits will generate interest, government securities have yield coupons, while a number of mutual funds and stocks can give you dividends. Meanwhile, gold cannot give you income in the form of cash like the financial instruments above.
Some even say that gold is not an investment, but an instrument used to protect the value of assets. The advantage of investing in gold is only capital gain or the increase in the price of gold itself over time.
2. Gold is not for the short term at all
Generally, gold is not a short-term investment instrument. Reselling gold in a short period of time can actually result in losses because there is a large difference between the purchase price and the gold buyback price, especially if the benchmark is Antam gold.
Maybe in certain conditions gold can generate short-term profits. However, naturally, gold has the nature of a long-term instrument.
3. Gold prices slow down when the world economy is stable
No one can predict what will happen in the future. When the economy is stable and there are no more bad sentiments emerging, then the gold price could slow down.
The slowdown is because investors in the world will be more interested in putting their money into risky assets such as stocks and others, rather than gold which is a safe haven.
The decline in gold prices will certainly affect the gold buyback price, which could result in investment losses.
4. The risk of loss is quite high
This applies to those who invest in gold bullion. Although there is already digital gold provided by several investment platforms, many people still think that buying gold safely is by buying gold bullion or physical.
When we have gold in real form, there will be a separate requirement for us to store it in a safe place.
Even if you store it in a place that you feel is safe, the risk of loss due to theft still exists. For this one risk, you can overcome it by renting a safe deposit box.
5. Risk of Fraud
In this case, all investment instruments also have a risk of fraud. However, in the midst of the rampant news about buying gold, you need to be careful that there are parties who take advantage of this.
You need to be aware of the risk of fraud in gold investment, such as fake gold and fake gold investment. Choose a trusted place to buy gold and don’t be easily fooled by the lure of unreasonable returns.
6. Currency Exchange Rate Risk
Gold investment is greatly influenced by the movement of the United States dollar. Therefore, the value of gold in rupiah will be affected by the rupiah exchange rate against the USD.
If the rupiah weakens against the AD dollar, the price of gold in rupiah will increase. Conversely, if the rupiah strengthens against the US, the price of gold in rupiah will fall.
7. Risk of Speculation
Although it has a natural nature as a long-term instrument, gold can also be an object of speculation. However, of course this risk is smaller than other instruments, such as stocks.
Speculators can cause the price of gold to rise or fall rapidly, which can harm investors who do not understand the risks of speculation. ***
