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What Moves Gold Prices?

Supply, demand, and investor behavior are key drivers of gold prices.
Gold is often used to hedge inflation because, unlike paper money, its supply doesn't change much year to year.
Studies show that gold prices have positive price elasticity, meaning the value increases along with demand.
However, the investment growth rate of gold over the past 2,000 years has not been meaningful, even as demand has outpaced supply.
Since gold often moves higher when economic conditions worsen, it is viewed as an efficient tool for diversifying a portfolio. (Investopedia)

Gold Purchasing power:
One good thing about gold: it does retain value. Erb and Harvey compared the salary of Roman soldiers 2,000 years ago to what a modern soldier would get, based on how much those salaries would be in gold. Roman soldiers were paid 2.31 ounces of gold per year, while centurions got 38.58 ounces.

Assuming $1,600 per ounce, a Roman soldier got the equivalent of $3,704 per year, while a U.S. Army private receives $17,611. So a U.S. Army private gets about 11 ounces of gold (at current prices). That's an annual investment growth rate of about 0.08% over approximately 2,000 years. (Investopedia)

If you're looking at gold prices, it's probably a good idea to look at how well the economies of certain countries are doing. As economic conditions worsen, the price will (usually) rise. Gold is a commodity that isn't tied to anything else; in small doses, it makes a good diversifying element for a portfolio.


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Moshkelgosha

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Reference Article:

https://www.investopedia.com/articles/active-trading/031915/what-moves-gold-prices.asp
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