When Is the Best Time to Buy Gold?

When Is the Best Time to Buy Gold?


Written by John Rothans

Sep 10, 2021

We recently looked at two decades of gold prices, and now you might be wondering when the best time to buy gold is. Is it worth it to wait until prices dip a bit? Or should you purchase some of the yellow metal right now?

When Should You Buy Gold?

Opinions differ on when the best time to buy gold is. But it’s safe to say that there’s no wrong time to buy gold. After all, this precious metal has been a store of wealth for centuries. Let’s look at a few instances when it might be the best time to add gold to your portfolio.

“Best Time to Buy Gold Is Before a Crisis”

One gold industry expert, Adam Trexler, believes that the best time to buy gold is “before a crisis.” In this instance, he’s making the case to purchase gold ahead of widespread inflation.

“There will be more and more spending, and there will be strong pressure to ignore inflationary concerns to achieve those targets. The Fed will be very slow to react, which is a recipe for higher and higher inflation,” Trexler says.

Trexler believes that inflation could rise to 10% and gold prices could rise in tandem with inflation. Historically, gold serves as a hedge against inflation. When inflation goes up, more people tend to flock to gold as a safe haven.

He forecasts inflationary pressures could cause gold prices to reach $2,500 or even $3,000 per ounce soon, compared with nearly $1,800 in September 2021.

“Best Time to Buy Gold Is When It’s out of Favor”

An article published in May 2021 by The National maintains that the best time to buy gold “is when it’s out of favor.” The premise is that you can take advantage of lower prices when demand for gold has tapered off. Then, once gold is back in favor and its price goes up, you can reap the rewards of having purchased the yellow metal at a discount.

“While the [price] of gold can decline over time, it has proven its long-term reliability, is far less volatile compared to cryptos, and many view it as a vital asset to hold in times of uncertainty,” Jason Cozens, CEO of Glint, which lets customers spend gold as money, told The National.

“The Question Should Be Rephrased from ‘When’ to ‘How Much?’”

Many industry experts believe that if you’re asking when to buy gold, you should rephrase your question. It’s not about “when” but “how much.”

“There is no good time to buy gold,” Albert Cheng, CEO of Singapore Bullion Market Association, told CNBC. Cheng predicts gold prices will hit $2,000 per ounce by the end of the year. Accordingly, he argues that everyone “should have some gold in their portfolio,” and more than the typical 1% to 5% that many financial advisors recommend.

“Gold remains a very small proportion of most people’s portfolio. But even an increase of 1 to 2% can have a massive bearing,” adds Cameron Alexander, a director of metals demand at Refinitiv.

Is Now Your Time to Buy Gold?

As the World Gold Council noted in an August 2021 report, the opportunity cost of buying gold continues to improve as the real earnings yield plus the dividend yield of the S&P 500 have fallen into negative territory for only the second time in 75 years.

In a September 2020 report, the Council pointed out that it doesn’t recommend a “best” time to buy gold. Instead, like U.S. Money Reserve, the organization emphasizes that “all portfolios should have an allocation to gold.” In other words, the best time to buy gold is when the time is right for you, based partly on factors like the current status of inflation and the current stability of the markets.

Now might be one of the best times to buy gold. Gold prices are already up 515% over the past 20 years and 38% over the past 5 years. Contact U.S. Money Reserve today to learn more about adding gold to your portfolio.


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