Tuesday, November 3, 2009

Goldfingers

Goldfingers


Goldfinger is a James Bond movie that goes back to 1964 (that's right I am a James Bond fan). However, we are going to talk today about Goldfinger(s). Golfingers is a term that I created for the group of people who are convinced in using Gold as a medium-term investment. Since the dawn of time Gold has been considered a safe haven that earned its value basically for being shiny and resisting harsh physical conditions (such as humidity). The glory of Gold continues until this day where it is still considered an excellent commodity for achieving financial security.

So, why to invest in Gold?


  • Gold is a limited resource; this means supply is decreasing year after year while demand in the worst case scenario would remain the same, eventually the price would go up (Trend of average price in US$ is heading upwards over time).
  • Great countries (such as China and India) did their math and they are also buying Gold in massive quantities.
  • In my opinion buying Gold is somehow similar to land investments, however Gold is easier to maintain and take care of than land investments.
Besides all of the above, one of the good reasons I am truly convinced with is that research says: Gold if obtained on a regular basis can beat inflation (inflation is the decrease in the value of money over time). Think of it this way, what was the price of a watermelon before 20 years and what is the price of a watermelon nowadays? Gold lasts, watermelon decays.

Tips for buying Gold
In Jordan:
  • The best method would be Gold coins. The two main forms of coins are "Rashady-which weighs 7 gm, pictured left" and "Englizi-which weighs 8 gm, pictured right". Both are 21 karat Gold. Coins are good because their sell/buy difference is small compared to jewelery.
  • Before buying Gold you can check current 24 karat Gold price in US$ (top left corner). 1Gold ounce = 31.1gram, 21K gram price = 0.881* 24K gram price . So for example: If the current Global Gold price is $1085/ ounce,
    The price of a 24K gram is $1085/ 31.1 = $34.88
    The price of a 21K gram is $34.88* 0.881 = $30.73
    The price of a 21K gram in JOD is $30.73* 0.7 = JOD 21.5
    Or alternatively use this site Gold Price in JOD.
  • I recommend you go to the Gold Souq in downtown Amman which might be a fun experience. Browse ten stores randomly and check for prices, this way nobody can cheat you. Also a sharp edge of the coin is considered a good sign.
  • Get a receipt for your coin; this will help you in case you intend to sell it in the future.
  • Every now and then keep track of Gold news, so that you will sell/buy at the proper time.
I thought I should give priority to this post so that you can benefit from the current upward trend of Gold price (current price is $1090, analysts expect it to reach somewhere near $2000). Goldfingers are waiting for you, what are you waiting for ?!

* Update - May 2010: Subscribe to this free newsletter which gives you hints about Gold price trends.

7 comments:

Naryat said...

Mom considers me a weardo, because ulike other women, I HATE gold :-)

I used to say that I prefer Diamonds, but after I read an article about "Blood Diamond" i stopped loving diamonds!

So i guess that my favourite now is silver :-) with ferooz stones, awesome! Of course, that's as a jewelery, not as an investment!

One thing i wanna add, don't forget that for investmen Gold, unlike jewelery, you have to keep checking if they convey the conditions of paying "Zakat"...

Nart Pshegubj said...

Well regarding Diamonds Naryat James Bond has another movie "Diamonds Are Forever" so we can consider Diamonds if you wish :)

Silver is directly above Gold in the periodic table and it can be a good investment as some analysts expect it to show a higher ROI (Return on Investment). However a couple of things need to be considered:
1- Silver price is fragile

2- You cannot invest in Silver coins here in Jordan because the buy/sell difference is high. Instead you can buy Silver ounces or a bucket of silver flakes (price JOD +600)

3- Gold resists harsh conditions more than Silver does

* Regarding Zakat you treat Gold according to its equivalent value in money and check if the total value meets the Nesab.

Naryat said...

I never thought of investing in silver! :-|

I love it as jewelery!

Isn't there a James Bond movie about "Silver"? loool

Likse "Silver Moon" masalan?

Nart Pshegubj said...

Ha ha, I am afraid the answer for that question is no. However, we will have to wait till 2011 to see what is the name of the next Bond movie ...

3imran said...

wallah ya sa7bi 3an jad great job.
wallah ta3ban mazboo6 3al site.
keep it up bro. :)

Nart Pshegubj said...

Thanks for leaving a comment Omran,
last night I did an intensive research about the Walther thing ;)

Naryat said...

Weptcha7ash7a Shu siqwash :-)

(TAG) qepfas3'a7e3' sebloggem!

Qebla3' (TAG)er wupthaghonem pai :-)

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