Stocks have get down This year. So already bitcoin. But in comparison, gold has had a pretty solid start to the year. The price of the yellow metal was almost unchanged, hovering below $1,800 an ounce.
Gold prices have also increased slightly over the past three months. So the escalation of commodities will increase? Can it return to all-time highs above $2,000 during the early stages of the pandemic in the summer of 2020?
Gold is often considered a good hedge against rising interest rates and inflation because it should theoretically hold more value as it is a tangible and scarce asset – unlike paper money and cryptocurrencies. death.
The return to market volatility this year, which has hit meme stocks and bitcoin in particular, could lead to further gold prices, according to some experts.
“Cryptos stole all the oxygen from gold last year and people use crypto for many of the same reasons as gold, hedging against inflation,” said Robert Minter, director of ETF Investment Strategy at abrdn. good.
But this year is proving that’s not the case.
“Investors are starting to see bitcoin as a riskier asset,” Minter said. It is not a portfolio diversifier and more of an energy drink,” said Minter, referring to the peak and equally epic pullback for crypto prices vs. much more steady moves in gold.
Gold is likely to remain a better option for investors looking for protection from rate hikes as the Fed battles higher consumer prices.
“There is a lot of inflation risk,” said Lauren Goodwin, economist and portfolio strategist at New York Life Investments. “They could recover on inflation concerns. Gold should be part of a diversified portfolio.”
Top miners Newmont and Barrick Gold were flat this year, which fluctuates quite a bit with the price of gold. That’s a lot better than the 9% drop in the S&P 500 and over 20% in bitcoin.
Some experts think gold will even move higher and hit new record highs later this year, especially if concerns about rising interest rates globally persist and worries about what will happen to prices. oil if tensions between Russia and Ukraine do not ease.
André Christl, CEO of Heraeus Precious Metals, said in a report: “Gold remains a safe haven and hedge against geopolitical risks, and the risk of persistently high inflation is also the thing. positive for gold”.
Christi argues that gold could rally to around $2,120 an ounce by the end of the year, hitting an all-time high of around $2,072 since August 2020.
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