Gold prices have become a hot topic lately. The sharp upward movement, even reaching new record highs, has many wondering whether now is the right time to sell gold, buy gold, or simply wait.
This question is understandable, given that gold is always considered a relatively safe investment instrument that can protect asset value over the long term. However, don’t rush to make decisions just because you are tempted by the trend.
While rising gold prices can be enticing, investment decisions should always be based on your financial goals and the right strategy. To be wiser, let’s discuss what actually drives gold prices up, as well as the benefits and risks of choosing to sell or buy gold at moments like this.
What Drives Gold Prices to Spike?
Gold prices are often referred to as a safe haven asset, an instrument sought after, especially when economic conditions are unstable. Whenever there is turmoil, whether inflation, interest rate changes, geopolitical conflicts, or currency depreciation, demand for gold usually spikes significantly. This drives the increase in global gold prices.
Price surges are also often triggered by rising demand from retail investors. When news about record gold prices spreads widely, many people experience fear of missing out (FOMO). As a result, gold prices are pushed even higher, although this may not be stable in the short term.
Is It Better to Buy or Sell Gold at a High Price?
Deciding to sell or buy gold when prices are high is not easy. Each choice has pros and cons that should be carefully considered. Let’s look at both sides: buying gold during a price increase and selling gold at peak prices.
- Benefits and Risks of Buying Gold When Prices Rise
Buying gold at a high price still has advantages, especially if you are investing with a medium to long-term outlook. Gold has proven to protect wealth from inflation and global crises. This means that even if you pay more today, gold can still serve as a solid store of value for the future.
However, there are risks to be aware of. Buying during a price surge means paying a premium, which could reduce potential profit margins from buy-sell price differences. There is also a chance prices may fall shortly after, causing short-term losses for investors entering at the peak.
- Benefits and Risks of Selling Gold When Prices Rise
Selling gold at high prices obviously looks profitable. You can gain higher returns from the difference compared to your original purchase price. This moment is often taken advantage of by investors who have planned to realize profits or require quick liquidity.
But selling at high prices is not without risk either. If gold prices continue to rise after you sell, you may miss out on greater future gains. Moreover, if your investment goal is long-term, selling too soon might reduce gold’s role as a value protector.
Also read: Read This Before Investing in Gold! 5 Secrets to Successful Gold Investment – Treasury
5 Tips for Investing in Gold When Prices Are Rising
- Focus on Long-Term Goals
Gold prices tend to fluctuate in the short term, but their long-term trend is more stable and generally upward. Therefore, when prices rise, stick to your original investment goals, whether to protect asset value, prepare an emergency fund, or build retirement savings.
Having clear goals helps you avoid being swayed by short-term price movements. While tempting to sell quickly when prices rise, if your goal is long-term, hasty decisions may reduce potential gains.
- Use a Gradual Buying Strategy
Buying a large amount of gold when prices are high risks paying too much. To mitigate this risk, a dollar cost averaging (DCA) strategy, which involves buying gold gradually in smaller, regular amounts, could be wiser.
This approach helps you keep investing without guessing when prices will go up or down. Regular, consistent purchases also reduce stress from market volatility and build strong financial discipline.
- Diversify Your Investments
It’s natural to want to put all your funds into gold when prices rise, but this is not always the best strategy since every asset carries its own risk. Diversification, spreading investments across stocks, mutual funds, bonds, and gold can protect your portfolio from major losses if gold prices reverse.
You can also take advantage of opportunities in undervalued assets when gold prices surge, keeping your portfolio balanced and not dependent on a single source of returns. A healthy investment is not only about chasing profits but also managing risks wisely.
- Pay Attention to Selling Moments
High gold prices may not always be the right time to buy, but they can be a good opportunity to sell. If you have held gold long enough and its value has significantly increased, consider taking partial profits during price spikes.
- Choose the Right Gold Products
Not all forms of gold are equally suitable as investment assets, especially when prices rise. It’s better to choose digital gold, which is easier to liquidate and has a tighter resale spread. Jewelry often has a large gap between buying and selling prices, making it less ideal for investment purposes.
Also, ensure that your gold purchase comes with an official certificate for safety and easier resale. If you opt for digital gold savings, check that the platform is registered and supervised by the appropriate authorities. This ensures your gold investment remains safe, efficient, and profitable even during upward price trends.
One proven safe digital gold investment platform licensed by BAPPEBTI and registered with KOMINFO is Treasury. With Treasury, you can start investing with as little as IDR 5,000, making it an affordable choice even for beginners.
Investing in gold when prices are rising requires a careful strategy to avoid emotional decisions. Rising prices should not prompt hasty buying or selling but rather a chance to reassess your investment goals with greater wisdom.
Don’t be overly worried about daily gold price fluctuations. Historically, gold prices tend to rise over the long term, which is why gold remains an ideal asset for medium-to-long-term financial goals. Start or increase your gold investments with Treasury today!
