Anyone who thought about buying precious metals over the last year has likely been waiting for the price to bottom out, which would make sense for any investor who wants to save some money. It appears as though the metal market has actually hit the lowest point it will go, as there is already something of a rebound happening. Looking at the price over the past few years it is easy to understand why many are proceeding with caution when it comes to buying. The prices have been all over since around 2007. The metals rose to record highs after a long run through 2011. They sustained some nice high marks too, at least until 2013. Things dropped quite a bit last year, and the drop only stopped in late 2013.
The Prices Are Going Up Once More
Right around the same time the government shut down, the prices of metals started to rise again. If you know anything about the metals market, this makes perfect sense. People start buying precious metals when they see uncertainty in the rest of the economy. A government that is not running is certainly a reason to worry, so the price of the metals started to climb. While they’ve been on a miniature roller coaster since then, they now seem to be on a path to go up slowly and steadily.
Before buying metals, it is always a good idea to see what some of the experts have to say. Even though they are fallible, they generally have their fingers on the pulse of the market and do a decent job of predicting where it might go. Most feel that the prices of gold will go up a bit in the next year. Some feel it could hit between $1,300 and $1,350 by the end of the year. It is currently $1,238 per ounce. They also have a good feeling about silver as well, and feel it could hit the mid $20 range. Right now, it trades at about $20 per ounce. Buying precious metals while the prices are still on the low side means a better return later. Those who are thinking about investing will want to watch the market carefully now.
What Causes the Prices to Rise?
In addition to the uncertainty that people feel about the economy, many things help to increase the price of metals. The demand for metals is rising. Gold is highly popular in China and India right now, as people there want to start buying precious metals. The industries in those nations are growing as well, which boosts the demand for all of the top metals including gold, silver, palladium, and platinum. The fear of inflation in the United States is another real problem, and one of the main reasons people want to buy metals. The inflation rates may well go up in the coming year, and the only real way to hedge against inflation is with gold and other metals.
They keep wealth safe, and it makes sense for investors to start buying precious metals and diversifying their portfolios.
Buying Your Metals
Now that the time has come to buy the metals, investors need to determine a few things. What type of metal do they want to buy? How much should they buy? Experts say putting between ten and twenty percent of investment capital into buying precious metals is a good choice whether buying mining stock, ETFs, bullion, or any other type of metal. Try to find the best buy-in point possible for the New Year so you have the best chance of making a nice return on your investment.