When to buy gold?
Seasons & trends in gold prices
Once you have decided to invest in gold, a common question is: what is the best time to buy gold?
Those buying gold naturally want to know how gold prices tend to behave between January and December each year.
Between 2000 and 2012 the price of gold has shown some interesting seasonality and trends that smart investors should be aware of.
Seasonal gold price trends
As the graph below shows, whether you buy gold in dollars, euros or pounds there are some gold price trends to watch for.
It seems that December, or the beginning of January, has historically been the most attractive time to buy gold online, regardless of which currency you invest with.
The price of gold often appears weak in the summer, as investors, central bankers and market participants take their summer holidays, before showing some stronger performance in the autumn.
When looking deeper into when to buy gold, the gold price in different currencies has also shown some notable trends.
Gold prices in US dollars show the most consistent gains in the early months of the year, whilst the autumn period also shows strength around the Indian wedding season.
The price of gold in pounds also has some seasonality to watch for, as the graph below shows.
Gold buyers with pounds will notice the beginning of the year showing less consistent gold price gains as dollar investors, but that they are most rewarded by gold price trends in November with strong average monthly rises.
The euro currency also has its own gold price relationships, showing the most volatile behaviour when priced in gold of the major currencies.
Those making gold investments in euros have less clear trends to look at and more volatility in terms of up and down months.
What to make of trends in gold prices?
Whilst the trends for gold prices are interesting to note, we shouldn’t plan our gold investing only around them. Trends can change and the figures for each month we look are an average taken over 12 years.
Smart investors might be well served to know what the price of gold has typically done in certain months, but ‘generally speaking’ doesn’t mean ‘always happens’.
There are few fail-safe ways to trade the gold price perfectly, hence why one of the most popular ways to build up a gold investment is to simply put the same amount into gold bullion each quarter. This is called ‘averaging in’; and means that when gold prices are higher you buy less, but also buy more when gold prices are lower. Averaging in means that you achieve a more attractive cost per ounce or kilo and are less exposed to short term volatility when you buy gold bars.
To help investors wanting to buy gold on a planned, regular basis we offer a flexible range of bullion savings products. To learn how our savings plans enable you to buy gold and silver with less hassle at specific times decided by you, click here.