Online gold trading is currently seeing record high numbers. With generation spanning heavyweights like the U.S. dollar and the Yen currently looking riskier and riskier traders are flocking to old reliables like gold to ensure their survival. Of course this is not a new phenomenon; wealthy investors have been buying up gold for years in order to avoid potentially devastating currency fluctuations, for example the catastrophic fall of Cold War era Russia’s ruble. Let’s review what makes online gold trading distinct from trading currencies.
Firstly currencies are far more volatile in the long run. Political and economic upheaval can send a currency hurtling downwards, sometimes never to recover. When a currency really loses its value it has to scrapped entirely and a new one put in its place. This can never happen to gold, its value is almost completely separate from the machinations of nation states and other political institutions. While gold’s value may fluctuate wildly every day, over long periods it is consistent.
The value of gold has traditionally been linked closely to the US dollar, with the former rising as the latter falls. When the value of gold rises so too does the value of currencies in gold producing countries. Similarly war, natural disasters, recession, etc. in these countries can have an effect on the value of gold, but usually only temporarily.
The majority of online gold trading is spot trading for speculative purposes. Most trading applications such as Metatrader 4 enable traders to buy commodities like gold and silver as well as currencies. In order to start trading gold you need to open a standard account with an online Forex brokerage, and this usually requires a minimum cash deposit of at least $1000. If you’ve never traded before some time spent with a demo account will be extremely beneficial. Online trading gold can be extremely profitable when done right so take your time and seize the opportunity when it presents itself!