Gold is a precious metal that’s traded across the globe. In fact, it has been around for thousands of years, being one of the most sought-after and valuable commodities in history! It has long been used as an investment tool by people all over the world who want to protect themselves against inflation or other types of economic uncertainty.
Commodities are products that form the basis of many industries and thus form an integral part of the economy. Each of these commodities is required by consumers, who cannot live without them. Therefore, when there is scarcity or oversupply in these commodities, then the prices will go up or down respectively. The increase or decrease of supply and demand for commodities leads to swings in the prices of commodities in order to balance them out with each other.
Where does gold fit in?
Commodities are classified into categories.
- Energy (including crude oil, heating oil, natural gas and gasoline)
- Metals (including gold, silver, platinum and copper)
- Livestock and Meat (including lean hogs, pork bellies, live cattle and feeder cattle)
- Agricultural (including corn, soybeans, wheat, rice, cocoa, coffee, cotton and sugar)
- Latest updates for Commodity Market
Commodities are not like stocks and bonds
Commodities are often bought and sold as a hedge against falling prices. The price of oil, for example, rises when demand is up and falls when it is down. Commodities often move in opposite directions to stocks, bonds and foreign currency. This makes commodities one of the riskiest assets you can hold. Also, if you own large amounts of commodities in terms of your overall portfolio, you can start to see unusual patterns to your returns such as volatility spikes or periods of negative returns on your investments.
The standard for Gold in commodities
If the market is volatile or bearish, the prospects of losing money in the stock market, trading in Precious Metals can create nice returns. Precious metal assets have historically been viewed as a reliable, dependable alternative to traditional assets. While they may be more volatile than stocks, they are also stable and safe from inflationary pressures.
Gold prices in India are determined largely through an informal process. There is no “kingmaker” as such in this market, as the Indian gold industry is dominated by bullion dealers rather than banks or other financial institutions. International prices do have a bearing on rates in India. However, the rates might not be the same as they are internationally. The IBJA plays a key role in determining day to day price changes in the country.
Gold is an important asset that has a vital role in our lives. It has many applications, from jewellery to electronics. Determining the value of Muthoot gold rate is not as straightforward as pricing assets like bonds and stocks but it can be broken down into four categories: exploration, mining, consumers and recyclers.
The London Gold Fix is a daily price settlement system that sets the price of gold in U.S. dollars and other currencies. The system was established in 1972 and serves as an anchor for all major markets around the world including Japan, France, Germany and others. Gold fixings are conducted twice a day on the first and third Friday of each month at 10:30 am GMT (London time) or 3 pm GMT (New York time).