What does Britain’s vote to leave the European Union have to do with gold? A lot.
In fact, Brexit has had an immense historical impact on the precious metal’s market. For investors and even regular British people, the future of the dollar is looming with doubt. However, gold, a longtime financial safe haven, has drawn considerable attention. Many people are swarming to convert their monetary wealth into gold standards. While the prices of gold fluctuate, the dollar is far less reliable. With the official Brexit ruling on the horizon, those who want to secure their future savings are eager to make the transfer.
For those following the precious metal market, there was an initial rise in gold prices following the Brexit vote. However, as expected, the price has since fallen. This dip in value has proven to be an exemplary opportunity for everyday citizens to invest in the valued standard. However, many people are still somewhat skeptical because of the fluctuations in price.
Industry professionals advise that there are many predictable factors that cause these movements. Nevertheless, gold has been a timeless investment for many countries that have a fluctuating currency. Though financial advisers have proposed scattered predictions about the after effects of Britain’s exit, the fact of the matter is that even speculation of a crisis can contribute to the gold’s value.
The amount of wealth that investors are choosing to invest in gold varies. However, analysts are seeing a greater percentage of wealth being transferred to gold than was during the 2008 financial crisis. Most investors have at least a small portion of their wealth in gold, but the projections of this safe haven have rallied a larger crowd than usual. Traditionally people invest about -20 percent of their wealth, but analysts are now seeing investments around 40 percent. Some people have even committed their entire life’s savings.
The rate at which people are buying up gold is astounding. Some were buying it even before Britain reached a consensus. However, mismatched feelings and ideas surrounding gold have contributed to many investor’s confusion. However, seasoned investors will be looking for opportunistic drops in prices between now and late winter/early spring. While gold cannot necessarily bring about the interest and turn around that traditional stocks can, weary investors are willing to step back and risk losing profits in order to secure a chunk of wealth for the future.