Gold plays a significant role in financial life. For us, as well as people around the world, it symbolizes "wealth, power, and prosperity." That's why we provide real-time updates for gold prices in Saudi Arabia. As much as people want to admire its beauty, they also want to know gold's financial value.
We All Value Gold
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This can be for a variety of reasons. Some people have jewelry that's been in the family for decades, and they want to know what it's worth. Some people are looking to buy items containing gold. For them, knowing the current value can help them time the market and get a better price.
Beyond the historical significance and retail value of gold, people are interested in it as an asset. Gold, as a tradable commodity, has held its value over the years. This goes back to our longstanding affinity for it as a symbol of wealth, power, and prosperity. The traditional way of investing in gold was simple. Someone would buy a piece of gold (sometimes in a block known as a bullion), store it safely, and sell it if its value increased.
That's still possible today. However, most people don't have the means to store large quantities of gold securely. Because of this, brokers have become the go-to medium for anyone wanting to invest in gold. As has been the case for every industry over the last 25 years, brokers have become digital. Instead of dealing with a single person, traders now have 24/7 access to the financial markets via desktop and mobile devices.
Indirect Exposure to Gold Through ETFs
Brokers give retail investors the ability to buy and sell gold directly, but they also provide indirect access to gold markets. They do this through a financial instrument known as an Exchange Traded Fund (ETF). An ETF is a basket of assets, and its price is derived from the combined value of these assets. Therefore, as a trader, you're speculating on the price of a single product (the ETF) but getting exposure to a variety of financial assets.
An online ETF broker provides access to two types of gold ETF: direct and indirect exposure. An ETF with direct exposure to the gold market allows you to speculate on the actual price of gold without owning the asset (i.e., you don't own gold bullion).
An ETF with indirect exposure to the market contains assets that have an interest in the gold industry, such as mining companies and jewelers. Again, you don't own the underlying assets. Instead, you're speculating on the price of an ETF that derives its value from companies that have an interest in gold.
Trade Smart and Don't Ignore the Risks
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There are risks to trading ETFs. Just like any other financial instrument, the value of an ETF can increase and decrease. Therefore, you need to be mindful of the money you're committing to trades. That being said, you can start with a small amount of capital at most online ETF brokers.
This makes the gold market more accessible to retail customers. When you add in the fact that online brokers provide risk-management tools and access to global ETFs, we can say that it's easier than ever to trade gold. By this measure, we're in a golden era for gold trading.
The information provided does not constitute specific investment research. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research and should therefore be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of ActivTrades' prices, nor an offer or solicitation to enter into a transaction in any financial instrument. The accuracy of the information provided is not guaranteed.
The material provided does not relate to any specific investment objectives, financial situations, or needs of the specific person who may receive it. Past performance is not a guaranteed indicator of future performance. AT provides an execution-only service.
Therefore, any person who makes a decision based on the information provided does so at their own risk.
