Gold prices continue to break records, what should you pay attention to if you want to invest?

In recent days, the price of gold bars has continuously set new records, causing many investors to want to "ride the peak" to make a profit. So what do experts recommend?

Gold is not for 'surfing'

According to experts, gold investment is a long-term investment channel, not for "surfing".

Dr. Nguyen Tri Hieu, a finance and banking expert, said that investing in gold, especially at its peak, needs to be oriented towards the medium and long term, because if you surf in a context of strong fluctuations, the risk is very high.

He analyzed that when the price of gold skyrockets, previous buyers tend to sell to take profits, creating a short-term adjustment force. Therefore, holding long-term will be more suitable to the nature of gold as a defensive asset, with low risk.

He recommends that investors should clearly define three core criteria when allocating assets: capital safety, profitability and liquidity. From there, each person can build a portfolio based on personal criteria such as risk appetite, loss tolerance and profit expectations.

According to him, investors should monitor factors such as global geopolitical tensions, the Fed's interest rate policy, exchange rate fluctuations and inflation. These are all variables that directly affect gold prices.

Reality, world gold price still volatile. After peaking at $3,500 an ounce in April, prices have corrected slightly but remain high.

Investing in gold requires a long-term view (Photo: Minh Duc).

In the Vietnamese market, domestic gold prices are not only affected by world prices but also face great challenges from domestic supply and demand.

The Government is in the process of reviewing and amending Decree 24/2012/ND-CP on gold market management. However, according to Dr. Nguyen Tri Hieu, the progress of the amendment is still slow and needs to be accelerated.

In addition, the domestic gold market is not connected to the world market, and the supply is limited. The scarcity of supply has pushed the domestic gold price up sharply, even though the world gold price sometimes decreases.

Therefore, Mr. Hieu believes that in the current period, investors should allocate assets in a balanced manner.

" Investors should keep about 1/3 of their cash in the bank to prevent risks and flexibly rotate; the rest should be divided equally between gold and stocks, two channels that are attracting great attention in the market ," Mr. Hieu advised.

Economist Ngo Tri Long also said that this is not an ideal time to buy gold, especially for "surfing" because there are many risk factors. If you decide to invest long-term for more than 1 year, investors can buy gold gradually, in small portions according to the price averaging method.

When the price of gold increases, buyers will have the mentality of "putting money down" to buy gold based on emotions without basing it on technical analysis or economic factors. In fact, many investors have fallen into heavy losses due to lack of knowledge and experience.

He cited that from around May to August 2023, the world gold price fell from 2,050 USD/ounce to 1,900 USD/ounce. This caused investors who bought at the top and sold at the bottom to lose 3-5 million VND/tael.

According to him, the level gold price difference Currently, the price of gold is up to 1 - 2 million VND/tael, which is high, so expecting to surf the gold price will be very risky if the gold price does not increase strongly enough to compensate.

Sharing the same opinion, Mr. Nguyen Quang Huy - CEO of the Faculty of Finance - Banking (Nguyen Trai University) also said that investing in gold at this time must be long-term, otherwise it will be easy to encounter many risks.

According to Mr. Huy, Vietnam is currently planning to establish a gold trading floor and is determined to narrow the gap between domestic and international prices. These factors will change the way the market operates, reducing speculation on price differences.

As the spread narrows, the “spread-taking” strategy becomes more difficult. Physical gold investors need to recalculate, focusing more on international trends and USD/VND fluctuations.

In addition, a centralized gold exchange can increase transparency, improve liquidity, and bring domestic prices closer to international prices.

" Gold is in a unique position, benefiting from geopolitical instability and the global interest rate cut cycle, while also being affected by competition for capital from domestic stocks. Meanwhile, upcoming regulatory policies will make the Vietnamese gold market more transparent but will also reduce its attractiveness in the short term.

Smart investors will not see gold as a “short-term price game” but as a strategic component in their portfolio, knowing how to patiently accumulate when the market adjusts and allocate capital reasonably between channels ,” Mr. Huy emphasized.

Should invest in gold rings or gold bars?

According to expert Tran Duy Phuong, this is a more profitable time to buy 9999 gold rings because the price of gold rings is 4.6 million VND/tael lower than the price of SJC gold bars.

He also warned investors to avoid buying at this time, because it will be very risky and there is a possibility of chasing the peak.

Experts advise investing in gold rings at this time (Photo: Minh Duc).

Gold prices are at their highest level in two weeks, thanks to increased demand for risk protection when the US reciprocal tariffs officially took effect. Ongoing trade tensions and unresolved geopolitical tensions will continue to support gold prices, as demand for "safe havens" remains high.

In addition, the possibility of the US Federal Reserve (Fed) cutting interest rates next month is high. This information has supported gold prices to approach the 3,400 USD/ounce mark.

Gold prices were also supported by weekly data from the US Department of Labor showing that the number of people filing for unemployment benefits for the first time rose to a one-month high. This data shows that the US labor market is weakening and thereby strengthens the possibility of the Fed cutting interest rates at its meeting next month.

Sharing the same view, Mr. Nguyen Quang Huy also said that the current domestic gold bar price is much higher than the world gold price by 16 - 17 million VND/tael. Therefore, people should not rush to buy, instead they can buy gold rings with the advantage of following the world price more closely, so there is less risk.

“ At the present time, if not necessary, investors should not buy gold, especially gold bars ,” he said.

Mr. Huy also noted that the current cash flow is shifting. Specifically, stocks have become the new capital attraction center with the expectation of upgrading from frontier to emerging market (most likely at the end of this year). It is clear that in recent weeks, this market has been "reviving", not only in terms of scores but also in terms of liquidity, business quality and the participation of foreign investors.

“ Securities are easily accessible, have small capital, and high liquidity, in contrast to gold bars - which often require large capital and low liquidity ,” Mr. Huy commented.

In addition, the FOMO (fear of missing out) sentiment in gold is clearly decreasing. Previously, when there was no clear channel, gold became the default choice. But now, when stocks are both easily accessible and there is a story of an uptick, speculative money has been gradually withdrawing from gold to look for yield elsewhere.

Source: https://baolangson.vn/gia-vang-lien-tuc-xo-do-ky-luc-muon-dau-tu-can-chu-y-gi-5055671.html