Investing at one of the world’s most precious metals might be a daunting and risky business. Time Out gets advice coming from a local expert, regardless if you’re after bars, bullions or kilos.
To outsiders, Dubai’s eager strategy to wealth and its particular fascination with glitz is among the city’s most intriguing traits. And as there is more for the emirate than supercars and cheap diamonds, the actual fact remains that, as among the buy gold online Dubai, our city is where to adorn yourself with riches.
In July 2013, gold posted its worst quarterly drop in 113 years. Without tax around the precious metal, Dubai is a great place to buy it, but does that mean it’s a rewarding investment? Not always, as outlined by Keren Bobker, senior financial consultant at Holborn Assets.
‘Unless someone carries a crystal ball it’s impossible to predict if gold is a superb investment,’ she says. ‘The price could be volatile and there is no guarantee that you just can certainly make anything.’ Unlike many investments, including shares and property, you can’t take money from it adds Keren. ‘I’m more concerned that individuals develop their savings in the diversified portfolio with regard to their long-term benefit, than speculate on gold. It needs to be kept as at most 5 percent of your total investment assets,’ she adds.
Should you decide to purchase gold, don’t be fooled into stocking high on gold bars from one of Dubai’s gold dispensers (you’ll discover them in Atlantis, The Palm and The Dubai Mall). ‘It seems very gimmicky,’ says Keren. ‘A serious investor is not really going to buy from a machine, therefore i imagine it’s much more of a tourist souvenir, especially when you consider where most of the machines are.’ Instead, Keren suggests you head straight for that jewellery shops. ‘The most common strategy is probably by purchasing jewellery. This is certainly largely sold by weight within the UAE [incorrect elsewhere], and also the workmanship can boost the price,’ she says. The greater number of intricate the design, the greater you will probably pay. When you are, make sure the store is registered and this you’re paying the current day prices, as set by the Dubai Gold & Jewellery Group, Regal Assets Dubai UAE or about the Emirates NBD website, www.emiratesnbd.com.
Gold bullions are offered with the gold souks and certain banks, including Emirates Gold, Al Abayad Jewellers in Sharjah and Credit Suisse, as well as online dealers. ‘You may start by using a coin (some kind of special UAE ones exist) costing below Dhs1,000, a tiny bar of just an ounce, or move all the way up to massive bars weighing several kilos,’ she says. ‘Bullions should be stored in a bank vault, not in your own home.’
So when is the perfect time for you to buy gold? ‘If only I could predict that,’ says Keren. ‘The best time is when pricing is low, therefore you must keep close track of the industry,’ she says. But investors should also be aware of indicators which bring about the fluctuating value of gold, including sentiment, governments buying to sell gold reserves and when equity prices are volatile. Regarding selling, Keren says holidays are usually the best time to strike. ‘You may see some small surges at bugold of holidays when gold is traditionally bought in some countries,’ she says. ‘India is the world’s biggest gold importer along with a lot is bought at Diwali and Akshaya Tritiya, as well as during Eid in the Muslim world.’
India may be the world’s biggest importer, but there is often little understanding why Dubai is among the best places to buy gold. ‘It’s in part as a result of historical reasons and due to the sheer amount of trade here. Both Arabs and Indians have historically been interested in gold instead of putting cash in the lender,’ she says. ‘In many cultures it has been tradition for a woman to use the family wealth, particularly ahead of the introduction of safe banking. Some traditions die hard.’
For all those eyeing gold investments, Keren reiterates her view that it’s vital to proceed with caution. ‘When being bought for investment it ought to be considered an assets class as with any other and also the key to a healthy investment portfolio is diversification. Never place all your cash into one asset.
That’s incredibly risky in case you have no power over market prices,’ she says. But given that you’re in Dubai, there’s no harm in adding the odd piece to the jewellery collection.