Smart investors love a good deal. They know that following the crowd is a quick way to lose money. They’ve seen plenty of bull runs end disastrously, such as the collapse of cryptocurrency prices, stock market crashes, real estate downturns, and more. Every asset goes through cycles, and some behave more erratically than others.
When investors look at opportunities in the bullion market, they may wonder whether now is a good time to buy or if they should wait.
Investing in bullion is faster than ever thanks to the role bullion dealers like Global Bullion Suppliers now play. They allow you to buy and sell physical bullion products on the spot at competitive prices.
A Brief History of Modern Gold Prices
The last two decades have been great years for gold. Looking at the last half-century, gold prices skyrocketed during the 1970s, alongside a surge in the cost of oil and a steep increase in inflation, all paired with a rise in international conflicts. Unfortunately, in 1980, prices started to plunge, and after the hype, gold prices hit a 19-year low around 2001.
But economics are cyclical, and those lows simply laid the groundwork for another meteoric rise in gold prices, once again coming alongside rising global commodity prices. Prices peaked once more about a decade later in 2011 before dropping (though not nearly as much as they had in the 1980s) and remaining quiet throughout much of the 2010s.
Prices picked up again in the late 2010s, gaining steam as multiple crises began to overlap, including COVID-19, disruptions to global trade, inflation, the Russian invasion of Ukraine, and more.
Now, analysts expect gold prices to climb up to $3,000 USD per ounce in 2025, which begs the question: do you invest now or wait for prices to go down?
Are Conditions Right for Prices to Fall?
Investing in gold is a strategy for hedging against inflation and stock markets. Gold competes favorably against bonds when interest rates are low, and it’s an asset that can provide security and stability to your portfolio.
In other words, gold is a very good asset to have, no matter the price. If you don’t already have it in your portfolio, buying it should be a priority unless you expect that market conditions will bring about a price decrease soon.
Analysts expect to see gold prices rise in the coming year, so investors looking for a bargain on bullion may have to wait.
Speculation vs. Strong Fundamentals
Investors are wise for avoiding speculative bubbles, but the opportunity cost of skipping an asset because it has strong fundamentals can also hurt your portfolio performance.
Learning how to tell the difference is a major challenge, and it can separate great investors from average ones.
One way to identify the difference between pure speculation and fundamentals is to look at an asset’s history. The less history it has, the harder it is to judge its response to market conditions, which is exactly what the world saw with cryptocurrency prices.
Gold goes back further than stocks, bonds, and any other financial instrument we have. The fundamentals are there – the timing is up to you.