Is it a good time to buy gold?

This article has been reviewed and updated for 2024.

You’re probably reading this because you have found yourself wondering ‘When should I buy gold?’ or ‘Is it a good time to buy gold?’.

Deciding to hold gold in your portfolio is one of the best decisions you can make for your financial future. But, like all investments the price can go up, down or just hold steady and this makes it difficult to decide when is the right time to make your gold investment.

When is the right time to buy gold?

Many people ask ‘Should I buy gold now’ because they are looking at the price of gold and wondering if it is going to go up or down, making for a more or less expensive purchase.

The price of gold has been on quite a journey in the last few decades. If you look back to the few years before 2006 some might argue that if you were going to invest in gold bullion, then would have been the time to clinch the deal. After all, the price had been holding steady at around $200-300/oz. After this point gold has had some good runs, and has not dropped below £1,000/oz since 2019.

Some of gold’s surges have been thanks to major upsets such as the UK banking crisis, the global financial crisis and the global pandemic. However, it is the policies that were put in place following these events that have continued to support the gold price and its gradual price increase.

It is always wise to hold gold in your portfolio as it has long been considered a hedge for uncertain, unforeseen times. However, the expansionary monetary and fiscal policies that we have been witnessing for decades have almost accelerated the need for investors to invest in physical gold. These are ongoing and so there is no set time when they will impact the price of gold.

What indicators should I look for to buy gold?

There is no secret calculation to work out when is the best time to buy gold, but there are some indicators that those who choose to invest in gold bullion use to help them decide when to execute their purchases.

When deciding when to buy gold some investors consider the following:

Read all about it - Those who invest in gold pay close attention to news events, both at home and abroad. Very often unexpected events such as the global pandemic, military invasions, political coups or major policy announcements such as interest rates can affect the price of gold.
What’s happening next door? By this we mean, look at what is happening across other asset classes. Often when people are rushing to hold cash then gold is underperforming or if stocks and property are doing well then gold is relatively cheap.
Gold is not a fling investment - the final thing to remember amongst all of this is that gold is a long term investment. The factors mentioned above are all caused by or are followed by long-term policies that give more reason to hold gold.

Gold is the foundation to a balanced, diversified portfolio. Investors who choose to buy physical gold bullion do not do so just to grow their wealth but also to protect and insure their portfolios.

Hardly any of the factors that have contributed to the increase in the price of gold have gone away. Or, if they have (perhaps, the pandemic) then they have left so much economic and political debris behind that this continues to support the argument for holding gold.

This is why you could argue that there is little reason to worry about the price of gold when deciding to invest. The long-term, increasingly higher prices are not a sign that you have missed the opportunity to buy gold. In fact it is to say the opposite - the arguments to own gold might be the ones that drive the price of gold, but it is not the price of gold that should form the decision to own it.

Should you even worry about the price of gold?

So, the price isn’t necessarily what should drive you to make a gold purchase in the first place. Gold comes into people’s consciousness either when the price is doing something significant (say, climbing to $2,000/oz for the first time) or something worrying is happening in the financial and geopolitical spheres. And more often than not the news-worthy gold price is happening because of those concerning events.

When times get tough people, politicians and economic decision makers can make some decisions that don’t always lend themselves to protecting your wealth. Gold is the hedge and the insurance policy for your portfolio.

Gold is a historical asset. For millennia humans have trusted gold to represent their wealth as they cross borders, as they face new regimes, as they fight wars and even to express their love for one another. Yes, gold is shiny which helps to make it attractive but ultimately we trust it because it works to protect us in times of need, and performs over long periods of time.

Also read: How much is a Gold bar worth in 2024

People choose to buy gold for the following reasons:

Hedge: Gold has historically performed as a hedge against systemic and monetary risks, inflationary and deflationary policies, stagflation, uncertainty and geopolitical risks.
Safe haven - Gold is the ‘borderless currency’. It does not require a monetary system, a financial set-up or a central bank in order to exist. Only global markets control its supply, demand or its price, not governments or central banks. It is this combined with its finite supply and indestructible quality has enabled gold to hold value over long periods of time, a stark contrast to other asset classes.
No third party liability - Compared this to stocks, shares, gold derivatives and currencies there is no third party liability. When you own physical gold bullion the gold is entirely yours. For other investments it can be the case that the underlying asset is very much dependent on how additional parties choose to act.
Diversification - Gold lends itself well to a balanced portfolio, as historically it has a negative or weak correlation to price movements in the financial markets, especially stock markets.
Liquidity - The very liquid, global gold market means it is straightforward for an investor to both enter and exit from their investments. The price is set by the market, unlike many other investment and currency options.
Protect Against Uncertainty - Ours is an uncertain age. Just in the last decade we have faced the fallout from a global economic crisis, major climate disasters, political upheaval and a global pandemic. Not to mention the potential of World War Three starting. These have all left us with a rising cost of living and investments that are losing value. This is why gold is a necessary asset for your portfolio, it is your insurance against such events.

Would you sell your insurance?

When you buy gold you are buying insurance. When we buy insurance for our homes we don’t ask ‘is now a good time to buy it?’ because we know that we want to insure our homes in case of any unforeseen events that will require insurance.

We also don’t find ourselves asking, when would it be a good time to be without insurance. It’s the same for gold. Rather than when is a good time to buy gold, we should ask ‘when is a good time to be without gold?’

For us, we don’t believe there is a time on the horizon when investors will be comfortable to fully diversify out of the gold holdings. The factors listed above that both affect the gold price and give reason to own it, are not going to go away anytime soon. If anything they will become more embedded in our economic and financial systems and continue to cause problems.

How to buy gold?

One of the reasons people worry about getting into gold investment at the right price is because they think it is expensive to get started. But, one of the advantages to gold investment is that it doesn’t require huge outlays on day one, or at all.

When you choose to buy gold bullion you can cost-average in. By investing in regular increments and slowly building, you can use the ever-changing price of gold, to your advantage. Doing this over a period of time will mean that ultimately your average cost of each gold purchase will be below the highs. You can start investing in gold bullion with £5,000, today.

If you are looking to buy gold then GoldCore offers investors the opportunity to buy physical gold bullion bars for direct delivery or secure gold storage in a variety of high-security vaults worldwide. We realise that making the decision to invest in gold can bring many questions, that’s why our team of experts is on hand to help. It’s straightforward to schedule your free strategy call with the GoldCore team or call our office on: Ireland +(01) 653 3426, UK +44203 0869200, US +1 888 381 8130. We look forward to hearing from you.

You may also like to read: Where to Buy Gold in the UK?