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Economics of Gold

The document discusses gold prices and investing in gold. It notes that during a period of economic recession, gold is an attractive investment option due to its low correlation with other asset classes and rising prices. Gold ETFs saw a 20% increase during this period. It provides tips for investing in gold, noting that historically gold prices have moved with oil prices and the dollar. The document also discusses India buying 200 tons of gold from the IMF to strengthen its reserves and voting power.

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Sowmya Charita
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79 views11 pages

Economics of Gold

The document discusses gold prices and investing in gold. It notes that during a period of economic recession, gold is an attractive investment option due to its low correlation with other asset classes and rising prices. Gold ETFs saw a 20% increase during this period. It provides tips for investing in gold, noting that historically gold prices have moved with oil prices and the dollar. The document also discusses India buying 200 tons of gold from the IMF to strengthen its reserves and voting power.

Uploaded by

Sowmya Charita
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Click to edit Master subtitle style E-COMMERCE

ECONOMICS OF GOLD
GROUP 13
4/15/12

Our approach

4/15/12

GROUP 13

attractive to investors

The article was published around the time of onset of recession. During this phase it was advisable to invest in safe investment options; GOLD was the obvious choice

This was because gold has a very less correlation between other asset classes like equity and debt thereby making it a good asset to diversify the overall portfolio

The price of gold was steadily rising during this period, meanwhile Sensex registered a drop of 25 percent

Gold ETFs gained focus and listed close to 20 percent increase in the stock exchange

4/15/12

July 18, 2009

GOLD ETFS & ITS ADV.

Gold

ETFs passively they

are

open

ended mutual funds that are and


4/15/12

managed the
OCTOBER 09,

mirror

return of spot price of

Advantages etfs

of

gold

4/15/12

GROUP 13

Largest buyers & producers

4/15/12

GROUP 13

Largest gold reserves

4/15/12

GROUP 13

Imf sells 200 tonnes of gold to rbi

IMF sold 200 metric tonnes of gold to RBI for around 6.7 billion dollars in a bid to raise the institutions financial capacity to lend money to poor nations at concessional rates

This
4/15/12

transaction is an important

GROUP 13

Why did india buy the imf gold?

The liberalization in India was triggered by the balance of payment crisis that our nation was facing

India in order to avoid defaulting the loans our country had pledged its gold to IMF to get a loan

This situation was reversed when IMF sold its gold in order to have enough resources to aid poor nations financially

One of the reasons for the speedy transaction could be that India is ensuring that it has a strong bullion reserve since the dollar was losing its sheen

The sale would also result in larger voting share in the IMF &

consequently a larger say in the world economic affairs 4/15/12

GROUP 13

tips for investing in gold

Historically,

the gold,

prices

of

crude oil and dollar


4/15/12

GROUP 13

CORRECTION PRICES

IN

GOLD

The article was published during the interim period of Nov. 18 to Nov. 30 Owing to the sudden rush of investors and buyers, the price of gold increased steeply during this phase

The maximum price of gold recorded for the day was Rs. 17131 This was likely to come down to Rs. 16900 in a weeks time Following a similar trend the price of gold hit a record high at the New York Mercantile Exchange at $1148.10 an ounce

This was because of a .037% dip in the dollar index The price volatility is mainly on account of continued weakness of the dollar and the recent selling of 200 tonne gold by the IMF to the Reserve Bank

The price rise is also due to the growing

interest of the Central Banks to

4/15/12 their reserves increase

NOVEMBER 18,

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