The amount spent on gold in the past 12 months has increased to $59.7 billion around the world, which AAA claims was given a healthy boost by China’s decision to hedge inflation by increasing its gold investment by 10 per cent.
The figures have been published by the World Gold Council in its Gold Demand Trends report, which also shows that demand for jewelry in China has driven the appetite for gold investment. “Demand for gold rises alongside appetite for alternative investments, but also increases when the population of a country gets wealthier and wants to diversify the risk in their portfolios by investing in tangible assets such as fine jewelry and precious metals,” explained AAA’s analysis partner, Anthony Johnson.
Much of the increase in gold buying took place among the Central Banks of the world’s emerging economies. These banks are looking for asset classes that will not necessarily follow the same patterns as stocks and bonds and other traditional investments.
Mr Johnson added, “And it’s not just financial institutions that are looking at alternative assets to balance out their portfolios, individual investors are now taking asset classes like gold, art, antiques, timberland, real estate and even wine and classic cars seriously.
“They know that these assets can hold their value during an economic downturn and, as a result, it’s a good idea to invest a large chunk of any portfolio in this sector - especially in such uncertain economic times.”
AAA, an alternative investment advocacy group, supports various alternative investment options, including timberland investment through sustainable projects like those run by Greenwood Management in Brazil.
About Alternative Asset Analysis:
The remit of Alternative Asset Analysis is to analyse and provide news on the global performance of a wide range of alternative asset classes including, but not restricted to, commodities, real estate, forestry, foreign exchange, hedge funds, private equity and venture capital.
Alternative Asset Analysis
71 Commercial St
Boston, MA 02109-1320