Getty Images/iStockphoto
The price of gold is hovering near yet another price record. After surging in value in 2024, gold is now priced at $2,515.17 per ounce, up significantly from the $2,063.73 per ounce it started at on January 1. And the price rise is understandable, as many have turned to the precious metal in recent years for its ability to hedge against inflation and diversify portfolios otherwise experiencing too much volatility.
As the economy evolves, however, and with cooling inflation sparking anticipation of interest rate cuts, gold investors will need to readjust their strategies and expectations. Against this backdrop, then, there are certain dos and don’ts of gold investing to be aware of heading into September. Below, we’ll break down six of them to know now.
See how the right gold investment could boost your portfolio here.
Dos and don’ts of gold investing this September
Ready to get started with gold now? Here’s what you should (and shouldn’t) do to better maximize your investment.
Do: Invest quickly
The price of gold is up more than 20% from January with many experts predicting a price of $3,000 ahead. So invest quickly if you’re considering gold. If you wait, the price could become prohibitive and it may never come down low enough again to become affordable. And with geopolitical concerns, inflation reports and Fed activity all in mind (all factors that drive the price of gold), that price could rise quicker than you think.
Start investing in gold today.
Additional Insight: Investing quickly is crucial in the gold market due to its volatile nature and potential for rapid price changes. Keeping a close eye on market trends and acting swiftly can help investors capitalize on emerging opportunities.
Don’t: Overinvest
Most experts recommend limiting your gold investment to a maximum of 10% of your overall portfolio. And that advice hasn’t changed, even with gold’s record price run this year. So avoid the temptation to overinvest in the metal and, instead, view it as the safe haven it’s historically been known as.
Additional Insight: Overinvesting in gold can expose investors to unnecessary risk. Diversifying across different asset classes can help mitigate potential losses and safeguard overall investment portfolios.
Do: Consider selling for a quick profit
Gold is not so much an income-producer as it is a safe and effective way to protect your money, as mentioned above. But, right now, some investors may want to take advantage of the rising price and consider buying in “low” now, to sell later for a quick profit. It’s not the traditional advice most would recommend for a gold investment but the price surge the metal has seen this year isn’t traditional, either. So now may be the time to consider alternative approaches.
Additional Insight: Taking advantage of short-term opportunities to sell gold can provide investors with quick gains, especially during periods of significant price fluctuations. However, careful consideration of market conditions and investment goals is essential to make informed decisions.
Don’t: Get invested in the wrong type
There are a variety of gold investment types to choose from, some of which may be better for beginners and some of which may be more appropriate for veterans. Understand the difference and where you lie on the spectrum to avoid getting invested in the wrong type. A rising price, after all, affects each type in different ways. So while gold is moving upward, overall, the wrong investment type could have detrimental, unintended consequences.
Additional Insight: Selecting the right type of gold investment is crucial for optimizing returns and minimizing risks. Conducting thorough research and seeking advice from financial professionals can help investors align their investment choices with their financial goals.
Do: Monitor the price daily
The price of gold changes multiple times throughout the day. So keep an eye on it, both for chances to buy in and for opportunities to sell at a significant margin. With so many factors driving the price, the volatility here could work in your favor – if you keep track of the price.
Additional Insight: Regularly monitoring the price of gold allows investors to stay informed about market trends and capitalize on favorable pricing opportunities. Staying proactive and adaptable in response to market fluctuations can help optimize investment outcomes.
Don’t: Be too focused on gold
While gold is where many investors focus when it comes to precious metals, other metals may also benefit your portfolio. Silver, for example, offers many of the benefits gold does at a much lower entry price point. And it also comes in a variety of types to choose from, which could be advantageous for some investors. So consider exploring these, too, in addition to your gold investment.
Additional Insight: Diversifying into other precious metals like silver can offer investors additional sources of value and potential returns. Exploring a range of metal investment options can help enhance portfolio resilience and versatility in changing market conditions.
The bottom line
The right gold investment could help buffer your portfolio and offer a rare opportunity to earn a profit right now. But you’ll need to take a strategic and nuanced approach, just like you would any other investment. So by taking the above steps now – and avoiding the aforementioned mistakes – you’ll better position yourself for gold investing success, both this September and in the months that follow.
