Investing in one of the world’s most precious metals can be a daunting and risky business. Time Out gets advice from your local expert, whether or not you’re after bars, bullions or kilos.
To outsiders, Dubai’s eager strategy to wealth as well as its fascination with glitz is amongst the city’s most intriguing traits. And as there is more towards the emirate than supercars and cheap diamonds, the actual fact remains that, among the https://www.youtube.com/watch?v=09zcvcO2FLY, our city is the place to adorn yourself with riches.
In July 2013, gold posted its worst quarterly drop in 113 years. With no tax on the precious metal, Dubai is an ideal location to buy it, but does that mean it’s a rewarding investment? Not really, as outlined by Keren Bobker, senior financial consultant at Holborn Assets.
‘Unless someone carries a crystal ball it’s impossible to calculate if gold is an excellent investment,’ she says. ‘The price might be volatile and there is not any guarantee that you can certainly make any money.’ Unlike many investments, including shares and property, you can’t take an income from it adds Keren. ‘I’m more concerned that individuals develop their savings inside a diversified portfolio for his or her long term benefit, than speculate on gold. It must be kept as no more than 5 percent of the total investment assets,’ she adds.
Should you decide to purchase gold, don’t be fooled into stocking high on gold bars from a of Dubai’s gold dispensers (you’ll see them in Atlantis, The Palm along with the Dubai Mall). ‘It seems very gimmicky,’ says Keren. ‘A serious investor is just not going to buy from the machine, and so i imagine it’s more of a tourist souvenir, especially when you consider where the majority of the machines are.’ Instead, Keren suggests you head straight to the jewellery shops. ‘The most frequent approach is probably by purchasing jewellery. This is certainly largely sold by weight within the UAE [far from the truth elsewhere], and the workmanship can raise the price,’ she says. The greater intricate the style, the greater number of you will probably pay. When you go, ensure that the store is registered and therefore you’re paying the current day prices, as set with the Dubai Gold & Jewellery Group, Regal Assets Dubai UAE or on the Emirates NBD website, www.emiratesnbd.com.
Gold bullions can be bought on the gold souks and certain banks, including Emirates Gold, Al Abayad Jewellers in Sharjah and Credit Suisse, as well as online dealers. ‘You will start having a coin (some kind of special UAE ones exist) costing less than Dhs1,000, a small bar of just an ounce, or move entirely up to massive bars weighing several kilos,’ she says. ‘Bullions must be kept in a bank vault, not in your home.’
When is the ideal time for you to buy gold? ‘If only I was able to predict that,’ says Keren. ‘The best time takes place when costs are low, which means you must monitor the current market,’ she says. But investors should also be aware of indicators which play a role in the fluctuating cost of gold, including sentiment, governments buying to promote gold reserves and when equity costs are volatile. Regarding selling, Keren says holidays tend to be a fun time to strike. ‘You may see some small surges at bugold of holidays when gold is traditionally bought in many countries,’ she says. ‘India is definitely the world’s biggest gold importer as well as a lot is bought at Diwali and Akshaya Tritiya, in addition to during Eid from the Muslim world.’
India may be the world’s biggest importer, but there is however often little understanding that explains why Dubai is one of the the best places to buy gold. ‘It’s partly as a result of historical reasons and because of the sheer volume of trade here. Both Arabs and Indians have historically been keen on gold as an alternative to putting cash in your budget,’ she says. ‘In many cultures it really has been tradition for a woman to utilize the family unit wealth, particularly prior to the introduction of safe banking. Some traditions die hard.’
For those eyeing gold as an investment, Keren reiterates her view that it’s important to proceed with caution. ‘When being bought for investment it must be considered an assets class as with any other along with the factor to a well-balanced investment portfolio is diversification. Never put all your hard earned money into one asset.
That’s incredibly risky when you have no power over market prices,’ she says. But as long as you’re in Dubai, there’s no harm in adding the odd piece to your jewellery collection.