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The image of gold that we are familiar with is that gold is one of the most highly secured assets, so when there are situations that negatively affect the economy, most investors will invest in safe assets. One of them is gold.
Before deciding to invest, no matter what you want to invest in, we need to study the information and analyze it thoroughly. Importantly, investment goals should be set in order to determine the timing, investment strategy, and risk considerations as well.
If we have heard the word profit You’ve probably heard the word loss. Not every investment is profitable. But what you should do when you want to invest is to minimize risk as much as possible. And one of the things that directly affect investors’ minds is taking borrowed money or money that we don’t plan when we lose, what we will do to get that money back, or setting goals that are inconsistent with the strategy used. so, when investing, it directly affects the minds of investors.
However, well-planned investments reduce risks. and increase the opportunity to make a profit. Therefore, as a guideline for planning, let’s look at these 3 investment guidelines.
Investment timing is very important because it determines your investment strategy. Most investors’ time frames are divided into short-term and long-term.
As an example, the situation in Ukraine and Russia directly affects the gold price, causing a sharp rise in a short period. This is partly due to the need for secured assets. And it may be sold to make a profit as well. which may increase the risk If the timing of investment is wrong or the gold price is not as expected. This may cause investors who have short-term investment goals to not cut losses but continue to hold gold investments until they become willing to lose and are unable to start buying or selling again according to the strategy laid out.
On the other hand, when long-term investors see a sharp rise in gold prices, they decide to sell to make a profit and wait for the low price to invest again. But the price did not fall as low as expected. Make it a short-term investment. That can’t follow the goals we set from the start.
Therefore, before deciding to invest in gold, there should be a clear investment time frame, target, profit point, or stop loss point that you want to invest in gold in the short-term or long-term so that you can choose an investment strategy that is suitable and in line with your desired goals.
Short term goals | Long term goals |
Gold ETFs | Gold Fund with Dividend Policy |
Gold Futures | DCA investment |
There are many types of gold investments. Let’s get to know 4 investment styles divided into short-term and long-term goals.
For short-term investors. Investors should choose to invest in Gold ETFs and Gold Futures. Gold ETFs are traded on the stock market where investors know the gold price. They can trade them instantly and are more convenient to trade. Gold Futures are gold futures contracts in the derivatives market. This allows investors to make profits on both rising and falling gold prices.
If we want to invest in the short term, the top consideration is price volatility. Therefore, when choosing a pattern to invest in, you must choose a pattern that is responsive and catches the moment quickly to keep up with price changes.
For long-term investors. The right investment style for gold is a gold fund with a dividend policy. Most gold funds in Thailand have a policy of investing in SPDR Gold Trust, which invests in gold bullion. The highlight of the gold fund with a dividend payment policy is its safety in keeping and the opportunity to receive a return during investment.
If we want to invest in the long term, what we should keep in mind is low risk and higher returns than deposit rates as a basis for choosing a fund.
Short-term and long-term goals have different investment strategies. Short-term investments should have clear buying and selling points. Whether profit or loss It is necessary to follow the established plans. Not cutting losses at the selling point will cause investment risks and may cause our investment to go wrong. Therefore, we should study various technical analyses to assist in determining the best point of purchase and sale.
Long-term investments, also known as dollar-cost averaging (DCA), are the regular purchase of gold for the same amount to create discipline in investing and, most importantly, to help diversify the risk of investing in gold as well.
Note: This article is for preliminary study only. This is not intended to guide investment in any way. Investors should study more information before making a decision.
Reference : setinvestnow.com
