Gold bar price hits consecutive peaks: Experts warn of risks for swing traders
Domestic gold bar prices hit a record high, but experts recommend this is not an ideal time to buy for short-term trading because the risk of loss is very high.
Quick summary:
Domestic gold price is much different from world price, limited supply.
It is advisable to balance your portfolio between cash, gold and stocks.
9999 gold rings have advantages over SJC gold bars in terms of price and liquidity.
Money is shifting to stocks thanks to expectations of market upgrade.
Domestic gold price this morning, August 11, decreased by 500,000 VND/tael, losing the historical high reached last weekend of 124.4 million VND/tael.
Financial experts say gold should be seen as a medium- and long-term asset, rather than a short-term speculative tool.
Dr. Nguyen Tri Hieu warned that when gold prices are high, buying to “make a profit” during strong fluctuations will be risky. Gold is inherently defensive and less risky when held for a long time.
He advised investors to consider capital safety, profitability and liquidity when allocating assets, and closely monitor the geopolitical situation, the Fed's interest rate policy, exchange rates and inflation.
In Vietnam, gold prices are affected by both the international market and domestic supply and demand. Limited supply and an unconnected market often cause domestic gold prices to be higher than world prices, sometimes with a difference of up to 16-17 million VND/tael.
The government is studying the establishment of a gold trading floor and amending Decree 24/2012 to narrow the gap and increase transparency. At that time, the “price difference” strategy will be difficult to apply, forcing investors to pay more attention to global price trends.
Expert Advice: Not the Time to Buy a Flip Flop
Dr. Nguyen Tri Hieu recommends allocating 1/3 of assets to cash, the rest divided between gold and stocks.
Expert Ngo Tri Long noted that one should not buy gold for short-term trading at this time, instead, one can buy and accumulate gradually if investing long-term. The current difference of 1-2 million VND/tael makes short-term trading potentially risky.
Mr. Nguyen Quang Huy added that 9999 gold rings are more profitable than SJC gold bars because the price closely follows international prices and has better liquidity.
In addition to gold, stocks are becoming a strong capital attraction channel thanks to expectations of market upgrades. Speculative money is leaving gold to seek higher yield opportunities in stocks, which require small amounts of money, are highly liquid and easy to access.
The FOMO sentiment on gold has decreased, while global economic instability and the possibility of the Fed cutting interest rates are still factors supporting gold prices at high levels. However, investors are advised to be patient, accumulate only when prices adjust and allocate reasonably between channels.
