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Golden Bull Market Commences

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Golden Bull Market Commences

Joe Foster, a VanEck strategist who specializes in gold and precious metals, said last Wednesday that with so many financial risks in play, gold would be at the head of a new bull market.

Foster made this claim after the price of gold went up to $1,377.50 per ounce.

This number is the highest since March of 2014.

Gold is up almost 29% in 2016.

In and of itself this is impressive, but even more so, when you look at the past three straight years of steady declines.

Britain’s decision to leave the European Union has been having economic consequences all over the world, but investors are also struggling with other financial risks while the United States Federal Reserve attempts to increase interest rates as central banks overseas decrease them.

Monetary policy that has been deemed radical and unconventional all over the world is also adding on to the mounting concern.

This is not helped by the possibility that stocks in the United States are topping out.

Foster spoke on CNBC’s Squawk on the Street and pointed out that gold does well based on financial risk.

When people are scared and want to protect their money, they turn to gold.

Gold is the answer to finding a store of value or a currency hedge, or a way to keep their wealth safe.

Gold will, at some point, experience a correction, though it has apparently shattered past the $1,300 level much more quickly than had been anticipated.

Foster acknowledges this point and also says that by factoring in a connected strengthening in silver, it is suggested that the runup in regards to precious metals may very well continue through the conclusion of 2016.

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Investing To See A Profit

Foster does not invest in the yellow metal himself.

Instead, he puts his investments into gold-related stocks, including miners.

His reasoning being that he thinks gold names have a tendency to outperform the commodity when the value is rising.

To date, the VanEck International Investors Gold Fund has raised to 115 percent.

Compared to a couple of years ago, mining operations are being controlled more efficiently, Foster adds.

He also offered a warning that by investing in mining requires research.

These entities can be risky, and you want to have all the information about individual mines before investing.

Will Gold Keep Rising?

Craig Johnson, a technical analyst, points out that it too early to say for sure whether the value of gold will overcome the high from 2011 when it was $1,900.

However, he believes that after surveying last Wednesday’s global environment, it could very well keep rallying.

The graph below shows the gold levels as they’ve fluctuated since 2010.

It is evident to see that gold may be on the rise again.

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What To Do If You Want To Invest

With this increase in the value of gold and the financial risks surrounding the economy after Brexit, some people are going to want to put their wealth into something more substantial.

If you happen to be one of these people, here are a few things you should know:

– Be aware of what you are investing in. You could invest in the metal itself, or the miners and other gold-related interests.

– Research. Look at all the information before you put money into anything. Figure out the pros and the cons and if you believe it is worth it.

– Know the risks. Every investment has risks. Again, this means research.

– Gold is currently very high in value. This may not be a permanent situation. Decide where your money could best be placed to maximize your profit level.

The Bottom Line

UBS told their clients last Wednesday that the new Gold Bull Market may just be the beginning.

June has apparently served as a turning point for gold, seeing as it has risen over the last two years filled with declines.

The price of gold has gone up to $1,377.50 per ounce, a number that is giving strategists hopes everywhere for a new bull market featuring gold.

Financial concern everywhere can be thanked for this great rise in gold.

When there are risks in the economy, most people look to secure their wealth.

Transferring it to gold is just one way to do this.

Some experts say that the gold rise may just be starting, while others acknowledge that it could fall at any time.

Nothing in finance is ever set in stone, after all.

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