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Industry Profile A. Commodity includes all kinds of goods. FCRA defines "goods" as "every kind of movable property other than actionable claims, money and securities. The national commodity exchanges have been recognized by the Central Government for organizing trading in all permissible commodities which include precious (gold & silver) and nonferrous metals, cereals and pulses, ginned and unginned cotton, oilseeds, oils and oilcakes, raw jute and jute goods, sugar and , potatoes and onions, coffee and tea, rubber and spices, etc. A commodity also has a use value, an exchange value and a price. It has a use value because, by its intrinsic characteristics, it can satisfy some human need or want, physical or ideal. By nature this is a social use value, i.e. the object is useful not just to the It has an exchange value, meaning that a commodity can be traded for other commodities, and thus give its owner the benefit of others' labor (the labor done to produce the purchased commodity). Price is then the monetary expression of exchange-value (but exchange value could also be expressed as a direct trading ratio between two commodities without using money WHAT IS COMMODITY MARKET?Commodity markets are markets where raw or primary products are exchanged. These raw commodities are traded on regulated exchanges, in which they are bought and sold in standardized Contracts. TYPES OF COMMODITY: Basically products in commodity is broadly classified into 3 category, they are • • • Agricultural product Energy product Metals 1 AMC Engineering college, Bannerghatta Road Bangalore - 83
Gold as an a investment option in commodity Market
HISTORY OF COMMODITY MARKET: The modern commodity markets have their roots in the trading of agricultural products. While gold and silver, wheat and guar, were widely traded using standard instruments in the 19th century in India, other basic foodstuffs as soybeans were only added quite recently in most markets. For a commodity market to be established there must be very broad consensus on the variations in the product that make it acceptable for one purpose or another. Ancient Indian use of bullions, stones and many agro product or other items as commodity money, people have sought ways to standardize and trade contracts in the delivery of such items, to render trade itself more smooth and predictable. The economic impact of the development of commodity markets is hard to overestimate. Through the 19th century "the exchanges became effective spokesmen for, and innovators of, improvements in transportation, warehousing, and financing, which paved the way to expanded interstate, national and international trade." Classical civilizations built complex global markets trading gold or silver for spices, cloth, wood and weapons, most of which had standards of quality and timeliness. Considering the many hazards of climate, piracy, theft and abuse of military fiat by rulers of kingdoms along the trade routes, it was a major focus of these civilizations to keep markets open and trading in these scarce commodities. Reputation and clearing became central concerns, and the states, which could handle them most effectively, became very powerful empires, trusted by many peoples to manage and mediate trade and commerce. Therefore the recent attempt by the Government to permit Multi-commodity National levels exchanges has indeed given it, a shot in the arm. As a result two exchanges Multi Commodity Exchange (MCX) and National Commodity and derivatives Exchange (NCDEX) have come into being. These exchanges, by virtue of their high profile promoters and stakeholders, bundle in themselves, online trading facilities, robust surveillance measures and a hassle-free settlement system. 2 AMC Engineering college, Bannerghatta Road Bangalore - 83
Gold as an a investment option in commodity Market
COMMODITIES MARKET CAN OFFER a) FOR AN INVESTOR:Commodities futures represent a good form of investment for an investor because of the following reasons:
High leverage – The margins in the commodity futures market are less than the F&O section of the equity market. Less manipulations - Commodities markets, as they are governed by international price movements are less prone to rigging or price manipulations. Diversification – The returns from commodities market are free from the direct influence of the equity and debt market, which means that they are capable of being used as effective hedging instruments providing better diversification. b)
FOR AN IMPORTER OR AN EXPORTER:
Commodities futures can help an importer or exporter in the following ways: Hedge against price fluctuations - Wide fluctuations in the prices of import or export products can directly affect your bottom-line as the price at which you import/export is fixed before-hand. Commodity futures help you to procure or sell the commodities at a price decided months before the actual transaction, thereby ironing out any change in prices that happen subsequently. c)
FOR A PRODUCER OF A COMMODITY:
Futures can help a producer as follows: Lock-in the price for the produce - If you are a farmer, there is every chance that the price of your produce may come down drastically at the time of harvest. By taking positions in commodity futures you can effectively lock-in the price at which you wish to sell your produce.
Assured demand - Any glut in the market can make you wait unendingly for a
buyer. Selling commodity futures contract can give you assured demand at the time of harvest.
3 AMC Engineering college, Bannerghatta Road Bangalore - 83
Gold as an a investment option in commodity Market
FOR A LARGE SCALE CONSUMER OF A PRODUCT: Control your cost - If you are an industrialist, the raw material cost dictates
Here is how this market can help a consumer: the final price of your output. Any sudden rise in the price of raw materials can compel you to pass on the hike to your customers and make your products unattractive in the market. By buying commodity futures, you can fix the price of your raw material.
Ensure continuous supply - Any shortfall in the supply of raw materials can
stall your production and make you default on your sale obligations. You can avoid this risk by buying a commodity futures contract by which you are assured of supply of a fixed quantity of materials at a pre-decided price at the appointed time. COMMODITIES EXCHANGE: A commodities exchange is an exchange where various commodities and derivatives products are traded. Most commodity markets across the world trade in agricultural products and other raw materials (like wheat, barley, sugar, maize, cotton, cocoa, coffee, milk products, pork bellies, oil, metals, etc.) and contracts based on them. These contracts can include spots, forwards, futures and options on futures. Other sophisticated products may include interest rates, environmental instruments, swaps, or ocean freight contracts.
4 AMC Engineering college, Bannerghatta Road Bangalore - 83
Gold as an a investment option in commodity Market
DIFFERENT COMMODITY EXCHANGES: (1) U.S MARKETS: (2)
• • •
The Chicago Board Of Trade (CBOT) The Chicago Mercantile Exchange (CME) The New York Mercantile Exchange (NYMEX) The New York Board Of Trade (NYBOT) The London Metal Exchange (LME) The Tokyo Commodity Exchange (TOCOM)
INDIAN MARKETS: Multi-Commodity Exchange (MCX) National Commodity and Derivative Exchange (NCDEX) National multi commodity exchange (NMCE)
INDIAN COMMODITY FUTURES EXCHANGES:
5 AMC Engineering college, Bannerghatta Road Bangalore - 83
and produces almost 14 percent of the world’s bullion. Chile. reduction in mine production is expected by 9% by the US 6 AMC Engineering college. Indonesia. Due to the expansion US Mining operations. Papua New Guinea. Hoping to control its declining production trend due to the extended weakness in the price of Gold in recent years. Colombia. Philippines.5 million ounces of Gold annually in the next 3 years. Ghana. Kyrgyz tan. Peru. Russia. Argentina. Gold Production by major region. It accounts for an estimated production about 11% of the world’s Gold supply. Zimbabwe. United States. 2008 (total. Uzbekistan. Canada. China . Mexico. It accounts for an estimated 16. Australia. The second largest producer of gold is United States.Gold as an a investment option in commodity Market INTERNATIONAL SCENARIO: Gold producing countries: South Africa. Bannerghatta Road Bangalore . Brazil. 2.556 tonnes) The largest producer of Gold is South Africa.83 . Mali. the South African Gold Industry is working in the direction to lower its production costs and boost productivity. and because of the reduced profitability due to the low price of Gold.
Though these countries add up to a very small share in world’s total supply. The third largest producer of gold is Australia with an 10% annual production.Gold as an a investment option in commodity Market during the next three years. Peru. Nearly 45% of the world Gold supply was produced by the top three producing nations. Chile and Brazil) and the Far East producers are expected to increase production in the next three Years. At present. 90% of the gold is used for jewellery. big producers. • • • India is the world's largest consumer of gold in jewellery as investment. Dubai. • • The gold hoarding tendency is well ingrained in Indian society. In July 1997 the RBI authorized the commercial banks to import gold for sale or loan to jewelers and exporters. Singapore and Hong Kong as doorways to important consuming regions • • Tokyo where TOCOM sets the mood of Japan Mumbai under India's liberalized gold regime. 13 banks are active in the import of gold. INDIAN GOLD MARKET: • Gold is valued in India as a savings and investment vehicle and is the second preferred investment after bank deposits. Latin America (Mexico. harvest and marriage season. their production increase will counteract some of the production cuts made by the top three. WORLD GOLD MARKETS: • • • London as the great clearing house New York as the home of futures trading Zurich as a physical turntable • Istanbul. Indian jewellery off take is sensitive to price increases and even 7 AMC Engineering college.83 . Bannerghatta Road Bangalore . Domestic consumption is dictated by monsoon.
TYPE OF MARKET: • • • CASH AND FUTURE MARKET: • Hedging is a mechanism by which the participants in the physical/cash markets can cover their price risk. • • • • • Currently the domestic production is 2 tonnes p.83 Cash market: it deals with the spot market trading Future market: it deals with future market trading .Gold as an a investment option in commodity Market more so to volatility.940 tonnes from mines and 6. India’s gold consumption is 25% of world’s total gold production. India has a very limited gold production of around 9 tonnes in 2002 The domestic production of the gold is very limited which is around 9 tonnes in 2002 including 2. This enables the participants in the 8 AMC Engineering college. Bannerghatta Road Bangalore . the relationship between the futures and cash prices is determined by cost of carry.203 tonnes from Birla Copper. Theoretically.a. • In the cities gold is facing competition from the stock market and a wide range of consumer goods. The two prices therefore move in tandem. only More than 90% of Indian consumption is met through imports The availability of recycled Gold is price sensitive and the fabricated old Gold scraps is price elastic and was estimated to be near 500 tonnes in 2006 rose almost more than 40%. The domestic consumption was stood at 750 tonnes in 2008 • PRODUCTION OF GOLD IN INDIA: • Gold holdings in India are estimated to be in the range of 10000-20000 tonnes and are predominantly private.
they would be compelled to speculate on prices.Gold as an a investment option in commodity Market physical/cash markets to cover their price risk by taking opposite position in the futures market. Bannerghatta Road Bangalore . • During shortages. • The spot price is the real price of the physical commodity while the futures price refers to the price of a contract being traded in the futures market. The bid and offer prices are based on the expectations of prices on the maturity date. • Futures prices evolve from the interaction of bids and offers emanating from all the buyers and sellers – which converge in the trading floor or the trading engine. Special margin deposits to be collected to be collected on outstanding purchases or sales to curb excessive speculative activity through financial restraints. REGULATORY MEASURES EVOLVED BY THE OMMISSION • Limit on open positions of an individual operator to prevent overtrading. • • Limit on price fluctuations to prevent abrupt upswing or downswing in prices.83 . extreme steps like skipping trading in certain deliveries of the contract. closing the markets for a specified period and even closing out the contract to overcome emergency situations are taken. Company Profile 9 AMC Engineering college. • Participants in physical markets use futures market for price discovery and price risk management. • Minimum/maximum prices to be prescribed to prevent futures prices from falling below the levels that are un-remunerative and from rising above the levels not warranted by genuine supply and demand factors. in the absence of futures market. In fact.
Mr. Wealth Advisory Services and Portfolio management Services.83 . providing globally acclaimed financial services in equities and commodities broking. Jain began his career in 1989 with Hindustan Lever’s commodity export business. viz. personalized service and cutting-edge technology. MBA and a Chartered and Cost Accountant. Mumbai (BSE) and the National Stock Exchange (NSE) and is also a member of both the exchanges. founded India’s leading financial services company India Infoline Ltd. It is registered with NSDL as well as CDSL as a depository participant. It offers broking services in the Cash and Derivatives segments of the NSE as well as the Cash segment of the BSE. Bannerghatta Road Bangalore . It is engaged in the businesses of Equities broking. among others. it offers Portfolio Management Services to clients. These services are offered to clients as different schemes. Indiainfoline a one-stop financial service shop. A SEBI authorized Portfolio Manager. most respected for quality of its advice. life insurance and mutual funds distribution.Gold as an a investment option in commodity Market Nirmal Jain. 10 AMC Engineering college. India Infoline Limited is listed on both the leading stock exchanges in India. in 1995. which he co-founded in 1994 to set new standards in equity research in India. the Stock Exchange. which are based on differing investment strategies made to reflect the varied risk-return preferences of clients. providing a one-stop solution for clients trading in the equities market. He was also associated with Inquire-Indian Equity Research. contributing tremendously to its growth. It has recently launched its Investment banking and Institutional Broking business.
Indian as well as global. Indian as well as global. Revenue generation is through the sale of content to financial and media houses. Thomson First Call and Internet Securities where India Infoline is amongst the most read Indian brokers. India Infoline's research is available not just over the internet but also on international wire services like Bloomberg (Code: IILL). Bannerghatta Road Bangalore . mutual fund and portfolio management services businesses. Revenue generation is through the sale of content to financial and media houses. commodities. 11 AMC Engineering college.Gold as an a investment option in commodity Market The content services represent a strong support that drives the broking. It undertakes equities research which is acknowledged by none other than Forbes as 'Best of the Web' and '…a must read for investors in Asia'.83 . commodities. The content services represent a strong support that drives the broking. mutual fund and portfolio management services businesses.
Gold as an a investment option in commodity Market Board of Directors Mr. Nirmal Jain R Venkataraman Mr. Bannerghatta Road Bangalore . 12 AMC Engineering college. Kranti Sinha Chairman and Managing Director Executive Director Independent Director Non Executive Director Independent Director India infolines services as follows.83 . Lending Services Equity & Derivativ e Trading Private Equity Institutional Distribution Services Internet Trading Depository Services Wealth Management Services International Equity & Commodities Commodities Broking Services Vision To be the most respected company in the financial services space India Infoline Commodities Limited. Nilesh Vikamsey Mr Sat Pal Khattar Mr.
Gold as an a investment option in commodity Market India Infoline Commodities Pvt Limited is engaged in the business of commodities broking.83 . Commodities 13 AMC Engineering college. Our experience in securities broking empowered us with the requisite skills and technologies to allow us offer commodities broking as a contra-cyclical alternative to equities broking. Research for the retail investor did not exist prior to Indiainfoline. India Infoline Marketing & Services India Infoline Marketing and Services Limited is the holding company of India Infoline Insurance Services Limited and India Infoline Insurance Brokers Limited. Bannerghatta Road Bangalore . Indiainfoline made it possible for clients to view transaction costs and ledger updates in real time. Mortgages During the year under review. Indiainfoline acquired a 75% stake in Money tree Consultancy Services to mark its foray into the business of mortgages and other loan products distribution. which was hitherto restricted only to the institutions. The business is still in the investing phase and at the time of the acquisition was present only in the cities of Mumbai and Pune. Indiainfoline now has plans to roll the business out across its pan-Indian network to provide it with a truly national scale in operations. Equities Indiainfoline provided the prospect of researched investing to its clients. The Company brings on board expertise in the loans business coupled with existing relationships across a number of principals in the mortgage and personal loans businesses. Indiainfoline leveraged technology to bring the convenience of trading to the investor’s location of preference (residence or office) through computerised access.
Average monthly turnover on the commodity exchanges increased from Rs 0. 14 AMC Engineering college. it graduated the Company into a one-stop retail financial solutions provider. a number of private sector insurance service providers commenced operations aggressively and elped grow the market. concurrently. No paperwork no queues and No registration charges. Direct and Affiliate channels. we have employed a multi pronged approach and reach out to customers via our Network.Gold as an a investment option in commodity Market Indiainfoline extension into commodities trading reconciles its strategic intent to emerge as a one-stop solutions financial intermediary. On the whole. the business is fairly insulated against cyclical gyrations in the business. The Company was among the first to offer the facility of commodities trading in India’s young commodities market (the MCX commenced operations only in 2003). Invest Online Indiainfoline has made investing in Mutual fund and primary market so effortless. Bannerghatta Road Bangalore . The Company’s commodities business provides a contra-cyclical alternative to equities broking. The commodities market has several products with different and non-correlated cycles. Insurance An entry into this segment helped complete the client’s product basket. Following the opening of the sector in 1999-2000. To ensure maximum reach to customers across India.34 bn to Rs 20.02 bn.83 . All you have to do is register with us and that’s all. Its experience in securities broking has empowered it with requisite skills and technologies.
That's not all. Bannerghatta Road Bangalore . Imagine a financial firm with the heart and soul of a two-person organization. Research. backed by in-depth research and advice from research house and tools configured as investor friendly.83 . The Daily Market Strategy is your morning dose on the health of the markets. Indiainfoline Equity Research is proud of its reputation for. A weekly outlook coupled with the best of the web stories from Indiainfoline and links to important investment ideas. Sound investment decisions depend upon reliable fundamental data and stock selection techniques. As a subscriber to the Daily Market Strategy. Five intra-day ideas. which could impact the market. Occasionally an investment idea from the research team and a crisp round up of the previous day's top stories. Newsletters. you even get research reports of India Infoline research team on a priority basis. Wealth Management Service. Leader Speak and features is delivered in your inbox every Friday evening. The Indiainfoline Weekly Newsletter is your flashback for the week gone by. and we want you to find the facts that you need. We offer you a dedicated group for giving you the most personal attention at every level.Gold as an a investment option in commodity Market Mutual fund Indiainfoline offers you a host of Mutual fund choices under one roof. Equity investment professionals 15 AMC Engineering college. unless the markets are really choppy coupled with a brief on the global markets and any other cues. A world-leading wealth management company that sits down with you to understand your needs and goals.
India Infoline Portfolio Management Service is a product wherein an equity Investment portfolio is created to suit the investment objectives of a client.83 . Bannerghatta Road Bangalore . resources into stocks from different sectors. LITERATURE REVIEW: INVESTMENT: 16 AMC Engineering college. They choose Ford Equity Research when they can clear your doubts. Portfolio Management Service. This service is particularly advisable for investors who cannot afford to give time or don't have that expertise for day-to-day management of their equity portfolio.Gold as an a investment option in commodity Market routinely use our research and models as integral tools in their work. depending on Indiainfoline invest client risk-return profile.
An investor’s plan of attack to guide their investment decisions based on individual goals. buy & sell guidelines & risk guidelines. REASONS FOR INVESTMENTS: Future income Earning short term & long term profit Liquidity of capital Saving the money Saving tax liability INVESTMENT ALTERNATIVES: As an investor will have a wide array of investment avenues available. such as: Non-Marketable Financial Assets: A good portion of financial assets is represented by Non-Marketable Financial Assets. The components of most investment strategies include asset allocation.83 . Two key aspects of any investments are time and risk. The sacrifice takes place now and is certain whereas benefit is expected in future & tends to be uncertain. Bannerghatta Road Bangalore . Provident Fund Deposits. 17 AMC Engineering college. Post office deposits Company deposits.Gold as an a investment option in commodity Market Investment is a sacrifice of current money or other resources for future benefits. These can be classified into the following broad categories: Bank Deposit. risk tolerance & future needs for capital.
Mutual Funds: It is an indirect way to invest in Equity shares or fixed income instruments. These indirectly mean that equity holder has a residual interest in income & wealth of the company. It means that one has an ownership stake in the company. There are various schemes floated by mutual funds which will help to invest your money as per your needs & requirements. 18 AMC Engineering college. • • • Treasury bills. PSU bonds. Some of the important money instrument are. Debenture of Private Sector companies. Bannerghatta Road Bangalore . Three board types of mutual funds schemes: • Equity schemes. Certificates of Deposit.Gold as an a investment option in commodity Market Equity Shares: Equity is the share in the company. • • • • • Blue chip Shares Growth shares Income shares Cyclical share Speculative shares Bonds: It represents the long-term debt instruments. Commercial bonds.83 . The issuer of a bond promises to pay a stipulated of cash flows. • • • • Government securities. Preference bonds Money Market Instrument: It is the instrument which has a maturity of less than one year. Equity shares are classified into the following broad categories by stock market analysis. Bonds may be classify into the following categories.
Life Insurance: It is not a direct form of investment but in a board sense. 19 AMC Engineering college. Bannerghatta Road Bangalore . Energy. Agricultural products.Gold as an a investment option in commodity Market • • Debt schemes.83 . etc. Few important types of insurance policies in India are. The most important financial derivatives from the point of view of investors are: • Options. Balanced schemes. such as: • • • Metals. Time-share in a holiday resort. Commodities: Commodities are the items that are generally small in size but highly valuable in monetary terms. • • • • Endowment assurance policy Money back policy Whole life policy Term assurance policy Real Estate: the most important asset in their portfolio is a residential house & the most affluent investors are likely to be interested in the following types of real estate: • • • Agricultural land. It may be viewed as a side bet on the asset. Financial Derivatives: it is an instrument whose value is derived from the value of an underlying asset. it may be viewed as an investment. Semi-urban land.
To understand the functioning of the commodity market & governing authority of commodity market. Research Methodology Sources of data collection The primary data is collected from investors & company with the help of a structured questionnaire. utilization of derivatives in the market. To understand. It gives brief idea about commodity derivatives and method of investment in gold. 20 AMC Engineering college.Gold as an a investment option in commodity Market • Futures. & lay down the fundamental & technical tools to predict the price of the commodity. mazgines & text books. Scope of the study The scope of the study was to get a clear view about the concept of “Commodity Market & Investment opportunities in gold” The report covers brief description about commodity market. Bannerghatta Road Bangalore . newspapers. The secondary data is collected from internet. evaluating the impact of various factors affecting the gold prices & hedging strategies used in the market. To understand the fundamentals of trading in derivatives in gold market. Objectives of the study • • • • To know the method of investment in gold market. methods of analyzing the price trends.83 . Statement of problem The statement of problem is to study the investment opportunities in gold market.
Gold as an a investment option in commodity Market Design of the study: Research design Descriptive design Sampling method Convenient random sampling is taken for this project Sampling method Convenient random sampling is taken for this project Sample size The sample size is 30 units from the Bangalore city. some of the predictions are based on the personal views of the experts. Due the volatility of the commodity market. So the critical information is not collected. Limitations of the study The interaction with company people may be influenced by their busy schedules and attitude.83 . The study was limited to a period of 45 days only. The sample unit has been randomly selected which might not give true representative of the total market 21 AMC Engineering college. Bannerghatta Road Bangalore .
Four years gold price as follows from 2005.2008 22 AMC Engineering college.Gold as an a investment option in commodity Market CHAPETER 2 ANALYSIS & DATA INTERPRETATION FUNDAMENTAL ANALYSIS: The fundamental analysis is likely to be based on demand & supply. currency fluctuation. government policy. geo-political tension. import & export. Bannerghatta Road Bangalore .83 . speculation and on some fundamental news so the fundamental analysis of gold is also associated with this factors. production $ consumption.
Bannerghatta Road Bangalore .83 .Gold as an a investment option in commodity Market REASONS FOR RISE IN GOLD PRICES The following are the reasons for rise in gold prices: In 2005 23 AMC Engineering college.
Net retail investment was 10% higher in tonnage terms and 21% higher in dollar terms. 22% below the level of supply 2004.83 . However. underpinned by fast growth in manufacturing and services. 1 India In both jewellery and retail investment in India were 16% higher than a year earlier. Bannerghatta Road Bangalore . As a result. Argentina’s further 12 tonne purchase brought its 2005 annual total to 55 tonnes. however reports from many countries now suggest that consumers have not only become accustomed to prices in excess of $400 per ounce but are prepared for further increases. and the financial comfort afforded by last year’s good monsoon contributed to this growth 24 AMC Engineering college.Gold as an a investment option in commodity Market The World Gold Council reveal that the rising gold price did not deter buyers. The results bring the year-to-date increase to 8% in tonnage terms and 23% in dollar terms. Identified net central bank selling was 42% below last year’s levels with sales partly offset by continued buying from Argentina. Overall supply of gold to the market was sharply reduced at 828 tonnes. Consumer Demand Purchasers in Asia and the Middle East are usually highly sensitive to changes in the price level. with net consumer demand 6% higher in tonnage terms (17% higher in dollar terms) than during the same period in 2004. jewellery consumption in Q3 was 6% higher than a year earlier in tonnage terms and 17% higher in dollar terms during the same period in 2004. Strong economic growth. net central bank selling is expected to rise. as part of the Central Bank Gold Agreement.
2005 also saw an increase in shopping festivals and promotions allied to festive occasions. Supply The overall supply of gold to the market in 2005 was sharply reduced from one year earlier at 828 tonnes. Bannerghatta Road Bangalore . Argentina. bought a further 12 tonnes. although the growth rate of this component was lower than in Q2. making 55 tonnes in total for the year.Gold as an a investment option in commodity Market rate. Industrial Demand Industrial demand accounted for 83 tonnes in Q3.83 . which had purchased 42 tonnes in the first half year. was lower than in 2004 when the rising price provoked more selling back of jewellery. 4 • Identified net central bank selling. too. at 87 tonnes. reflecting the first signs of economic slowdown. 3 • Scrap. a 5% rise on the same period in 2004. 22% below the level of supply in 2004. remained substantially less than 2004 levels. 2 • De-hedging was substantial in the quarter reaching an estimated 144 tonnes compared to an exceptionally small (for recent years) 4 tonnes one year earlier. particularly in the light of the oil price rise. Among the signatories of the Central Bank Gold Agreement there was continued.The rise in price encouraged investment buying as did the underlying concerns regarding geopolitical issues and fears over potential inflation. bars and coins. Electronic demand continued to be the main influence. steady selling by Switzerland and also a small sale by Germany for coin minting. 25 AMC Engineering college. 1 • Mine production was 3% lower due to temporary factors including the ongoing effects of last year’s landslides at the Grasberg mine in Indonesia.
168 tonnes. bar hoarding and official coins increased by 8% and 6% respectively over the year while retail investment in medals and imitation coins. United Arab Emirates and Turkey for the year as a whole. double-digit increases were seen in India (up 14%) and Saudi Arabia (up 12%) with solid increases of around 6 to 8% in China. there was positive growth in all categories of gold investment for the year as a whole. Bannerghatta Road Bangalore . In tonnage terms.83 . for the third successive year. Aside from ETFs and similar products. in Turkey.Gold as an a investment option in commodity Market In 2006 Investment Demand Identifiable investment in 2006 was 26% higher than a year earlier in tonnage terms and 37% higher in value terms. grew by a substantial 26% over the year. Despite profit-taking in the fourth quarter. New annual demand records were set in 2006 in UAE. Taiwan. Jewellery Demand Overall jewellery demand in 2006 was 5% higher than 2005 in tonnage terms and a substantial 14% higher in dollar terms. Of the total 203 tonnes inflow. or 83% of the total. Vietnam and. 26 AMC Engineering college. a category concentrated largely in India. street TRACKS Gold Shares. The fastest growing category was Exchange Traded Funds and similar products (ETFs) which grew by a massive 53% in tonnage terms and 67% in dollar terms. listed on the New York Stock Exchange. were accounted for by the WGC-backed.
Gold as an a investment option in commodity Market Consumer demand trends in India: 1 • Overall consumer demand in India in 2006 was 17% higher in tonnage terms than the year before.83 . Investment into the ETFs varied throughout the year but they continued to attract “buy and hold” investors. according to figures published by the World Gold Council (WGC). reducing the quantity of gold purchased. In 2007 Consumers and investors pushed demand for gold to a record level of $65. In rupee terms. 1 • Net retail investment was less affected by the upward price movement and set a new annual record in tonnage terms. with positive tonnage growth in the investment and industrial segments and double-digit dollar growth in the jewellery sector. The record dollar values for overall demand and jewellery demand occurred despite a fall in supply. thus suffering only very limited attrition at times when other gold instruments 27 AMC Engineering college. 1 • Jewellery demand also experienced a second successive annual record of over 20% in rupee terms over 2005. The fourth quarter was particularly strong with a 19% rise in tonnage terms and a 51% increase in dollar terms. this was equivalent to a 25% increase bringing the value of gold demand in India to a second successive annual record. Investment Demand Identifiable investment in 2007 was 7% higher than 2006 in tonnage terms and 45% higher in dollar terms. with a massive 34% increase over 2005. .3billion in 2007. This translated to an increase of 14% in tonnage terms. accounting for 589 tonnes. Bannerghatta Road Bangalore .
worth $13. As price volatility subsided from late August. However. net retail investment displayed a steadily improving trend throughout the year.3bn. both of which occurred almost simultaneously in late-October. in Q3 and Q4 tonnage was 16% and 41%higher. Jewellery Demand For the year as a whole.5bn. In Q1 and Q2 tonnage was 33% and 18% respectively below year-earlier levels. Bannerghatta Road Bangalore . This period also saw the run-up to both Diwali in India and the id ul Fitr at the end of Ramadan. when price movements were a deterrent to jewellery purchases. It then surged from midSeptember to late-October when the price fell below $600 and remained. helped demand recover. and which are both strong gold buying occasions. Aside from ETFs and similar investment products. demand rose 14% to a new annual record of $44bn. at 2. In the first half year it was 28% lower than a year earlier in tonnage terms and effectively unchanged in dollar terms. especially in Asia and the Middle East.5 tonnes. a fall-back of the price in December. conditions became better for jewellery demand. jewellery demand in Q4 was stronger than in the earlier part of the year.83 . By the end of 2007 the gold held by ETF and similar funds amounted to 652. mainly due to declines in the first eight months of the year. In summary. in a $570-$600 range. In Q3 it was 9% lower than a year earlier in tonnage terms 28 AMC Engineering college. coupled with Christmas and the Eid al Adha at the end of the year. Q4 was also a record in dollar terms at $13. While demand was lower in November. tonnage was 16% lower than a year earlier. until the very end of October.267 tonnes.Gold as an a investment option in commodity Market were seeing disinvestment.
Tonnage figures. Bannerghatta Road Bangalore . Industrial Demand Industrial and dental demand reached a new record in both tonnage and dollar terms in 2007. less than half the 659 tonnes recorded for 2006. falling 13% from 2006 levels to 3. During the calendar year 2007 their net sales amounted to 341 tonnes. In dollar terms the year on year increases were 45% for the category as a whole and 51% for electronics. up 7% on 2006 at 458 tones. Total mine supply (mine output less net de-hedging) was therefore 15% lower in 2007 than in 2006. Mine output contributed a further 56 tonne reduction.Gold as an a investment option in commodity Market but 29% higher in dollar terms. due to a sharp reduction in net central bank selling. Signatories to the Central Bank Gold Agreement (CBGA) sold just 395. This was due to vibrant demand from the electronics sector. Supply Gold supply was tight in 2007. with non-CBGA signatories accounting for 22 tonnes of net purchases. These factors reduced overall supply by 657 tonnes.75 tonnes during the second Agreement year (27 September 2006 to 26 September 2007). over 100 tonnes below the 500 tonne limit.451 tonnes. and to a sharp increase in producer de-hedging. 29 AMC Engineering college. In 2007 as a whole de-hedging amounted to 403 tonnes compared to just 86 tonnes in 2006.83 . In Q4 it was 2% higher than in Q4 2006 and 29% higher in dollar terms. Net central bank sales amounted to just 319 tonnes in 2007. rising 11% in tonnage terms to 312 tonnes. which also established new annual records.
up 14% on 2007. 2008 brought record overall demand for gold.Gold as an a investment option in commodity Market Scrap supply. the second highest annual figure ever. In the investment sector. in the form of bars and coins was up 2% year on year in 2008.83 . Jewellery demand was. In Turkey. According to World Gold Council’s (“WGC”) Gold Demand Trends. There were very positive stories in three key gold markets. but the last quarter was heavily impacted by price 30 AMC Engineering college. the only element of supply which is responsive to price movements in the short-term. the highest quarterly level in recent years. In China total consumer demand reached 326 tonnes. but this was not sufficient to counter the 23% fall in the other three elements combined. Strong growth continued in Russia with jewellery demand rising 11% to set a further annual record. or 20%. Net retail investment demand was up 2% on 2007 at 61 tonnes. 26% above 2007 levels. identifiable gold demand was 4% higher in 2008 than in 2007 at 3. with demand for jewellery reaching 302 tonnes and surpassing 300 tonnes for the first time since 1997. China has now overtaken the US as the second largest volume retail market for gold jewellery after India. Bannerghatta Road Bangalore . Q4 2008 saw record levels of inflows at US$8 billion. at 188 tonnes. Growth remained vibrant throughout the year with demand in Q4 nearly 25% higher than a year earlier – making Russia the fastest growing country for the quarter. coupled with a gold price racing towards the long held $850 record. Net retail investment. combined to make dollar demand for gold hit a record US $79bn in 2008. In 2008 A steady annual increase in overall identifiable gold tonnage demand. rose by 180 tonnes.547 tonnes.
The moving average is a simple method when compared to least square and it also gives the price movement in an easy way. Overall identifiable dollar investment demand was up 15% on 2007 levels. up 2% on 2007. thus highlighting longer-term trends or cycles. 4% lower than 2007 levels. was up 2% year-on-year at 77.4 tonnes. TECHNICAL ANALYSIS: MOVING AVERAGE ANALYSIS: Moving averages are used to smooth out short-term fluctuations. Demand for the fourth quarter meanwhile. Total ETF demand was 251 tonnes for the year. Industrial demand reached a record 465 tonnes in 2008. demand fell back to 78 tonnes for the last quarter. After record inflows into gold exchange traded funds in the third quarter of 2008(139 tonnes).83 2008 . Net retail investment in Q4 at 67 tonnes was 39% lower than Q4 2007. The following table show the three years moving average of gold in -2009 31 AMC Engineering college. Bannerghatta Road Bangalore .Gold as an a investment option in commodity Market movements as investors took profits.
Bannerghatta Road Bangalore .83 .Gold as an a investment option in commodity Market Gold price Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Price 12702 11400 11100 11700 12000 12800 12600 11400 13110 13700 14852 Average 11734 11400 11600 12167 12467 12267 12370 12737 13887 Graph Showing three yearly moving average 32 AMC Engineering college.
For estimating the risk. Risk Risk refers to the possibility that the actual outcome of an investment will differ from the expected outcome. Bannerghatta Road Bangalore .14000 in 2009. The standard deviation is a measure of how widely values are dispersed from the average value (the mean). most of the investors use standard deviation.83 . The following formula is used for computing standard deviation. 33 AMC Engineering college.Gold as an a investment option in commodity Market The above graph represents that the gold price indicate the bullish trends in the market the gold price may go beyond Rs.
2009 Date Price 1/1/2009 1/2/2009 1/3/2009 1/4/2009 1/5/2009 1/6/2009 1/7/2009 1/8/2009 1/9/2009 1/10/2009 1/11/2009 1/12/2009 1/13/2009 1/14/2009 1/15/2009 1/16/2009 1/17/2009 1/18/2009 1/19/2009 1/20/2009 1/21/2009 1/22/2009 1/23/2009 1/24/2009 1/25/2009 1/26/2009 1/27/2009 1/28/2009 1/29/2009 1/30/2009 1/31/2009 13435 13650 13575 13540 13425 13425 13220 13445 13375 13602 13405 13700 13555 13250 13310 13090 13200 13240 13285 13195 13215 13610 13485 13765 14075 13485 14075 14005 13865 13740 14175 Total 419417 Mea n 13530 SD= 34 AMC Engineering college.83 .Gold as an a investment option in commodity Market For calculating the S. Bannerghatta Road Bangalore .D. 2009 is considered as below Calculation of SD for the moth of Jan . the price of gold in Jan – Feb .
9890 0.91840 -4.5934 0.6971 1.83 .9996 0.9774 0.5270 -1.3398 0.0 1. It represents “the reward for undertaking investment”.90150 -3.2504 0.5503 1.600 0.3962 1.7019 0.0000 0. The return on gold is calculated by using following formula Return = (closing price-opening price)/opening price*100 Date 1/1/2009 1/2/2009 1/3/2009 1/4/2009 1/5/2009 1/6/2009 1/7/2009 1/8/2009 1/9/2009 1/10/2009 1/11/2009 1/12/2009 1/13/2009 1/14/2009 1/15/2009 1/16/2009 1/17/2009 1/18/2009 1/19/2009 1/20/2009 1/21/2009 1/22/2009 1/23/2009 1/24/2009 1/25/2009 1/26/2009 Opening Price 13435 13650 13575 13540 13425 13425 13220 13445 13375 13602 13405 13700 13555 13250 13310 13090 13200 13240 13285 13195 13215 13610 13485 13765 14075 13485 Closing Price 13650 13569 13540 13540 13425 13220 13445 13375 13602 13405 13700 13555 13250 13310 13090 13200 13240 13285 13195 13195 13610 13610 13485 14075 13485 14075 Return 1.4483 2.1515 -2. Bannerghatta Road Bangalore .Gold as an a investment option in commodity Market Return Return is the income expected by the investor for investing his money in a particular security/commodity.3030 0.1484 3.8541 0.3752 0.8174 -0.2075 0.4973 0.1659 35 AMC Engineering college.
Its value swings between an upper limit and a lower limit.[100/(1 + RS)] Where: RS = AG/AL AG = Average gain of upward price moves over RSI period of n days AL = Average loss of downward price moves over RSI period of n days n= days (many analysts use 9 . The RSI can be calculated by using following formula. such as 14 days. The RSI is an oscillator.83 . RSI is calculated using an exponential moving average of the upward price movements divided by the downward price movements over a particular time interval.467 1332 88. RSI = 100 . Bannerghatta Road Bangalore .15 day RSI) Date Gold Price Gain 1/1/2009 13435 1/2/2009 1/3/2009 1/4/2009 1/5/2009 1/6/2009 1/7/2009 1/8/2009 1/9/2009 1/10/2009 1/11/2009 1/12/2009 1/13/2009 1/14/2009 1/15/2009 Total Average 13650 13575 13540 13425 13425 13220 13445 13375 13602 13405 13700 13555 13250 13310 Loss 215 75 35 115 0 205 225 70 227 197 295 145 305 60 220 1057 70.8 36 AMC Engineering college.Gold as an a investment option in commodity Market RELATIVE STRENGTH INDEX (RSI): RSI measures the strength or weakness of recent activity relative to historical activity for a particular stock or index.
243 Interpretation: When the RSI rises above 35 or 40 (in a bull market).Gold as an a investment option in commodity Market RS= Relative Strength RSI= Relative Strength Index RS= ∑Avg gain per day/ ∑Avg loss per day = 70. the gold is over priced.467/88.8 = 0. Bannerghatta Road Bangalore . DATA ANALYSIS & INTERPRETATION OF PRIMARY INFORMATION TABLE trading 37 AMC Engineering college.(100/1+Rs) = 100-(100/1+.243. it is considered overbought.83 1: showing number of respondents aware of Commodity . Since the RSI is 44.7935) = 44.7935 RSI = 100 . Hence it may be sold.
Respondents 21 9 of Percent age 70% 30% 38 AMC Engineering college.NO . of respondent aware of commodity trading 77% 23% From the graph it is clear that. 1 2 Particular Yes No TOTAL No.83 commodity trading.00% 23. respondents 23 7 30 of Percentage 77. Bannerghatta Road Bangalore . 77% of the respondents are of commodity trading & 23% of the respondents are unaware of the commodity market. Interpretation: It is clear from the above table that the many respondents are aware of Table 2: market Sl No. Showing number of respondents dealing in commodity .Gold as an a investment option in commodity Market SI.00% 100% Source: question No1 from Questionnaire NO. 1 2 Particular Yes No No.
33 20. No.00 13.33 23. Bannerghatta Road Bangalore . of years in trading No. Respondents of Percenta ge 1 2 3 4 6 months or less 1 year or less 2 year or less More than 2 year Total 13 07 06 04 30 43. Table 3: Showing the respondents experience in trading Sl.of respondent dealing in commodity market 30% 70% Analysis: From the above graph it is clear that. 70% of respondents are dealing in commodity market & 30% of the respondents not trading in the commodity market.34 100% 39 AMC Engineering college.83 . Interpretation: It is clear from the above table that the many respondents are dealing in Commodity market.Gold as an a investment option in commodity Market Total 30 Source: question No2 from Questionnaire 100% NO. No.
of Percentage Responden 53. Particulars No. They are the well aware of market conditions.34% of respondents are settled in business of more than 2 years. 20.67% 100% ts 1 Yes 16 2 No 14 Total 30 Source: question No4 from Questionnaire 40 AMC Engineering college. TABLE 4: showing investors’ knowledge about commodity derivatives market Sl No.83 .33% 46. Interpretation: We can say that investors having sufficient knowledge in commodity trading.33% of the respondents are settled in investing business6 months or less. Bannerghatta Road Bangalore .Gold as an a investment option in commodity Market Source: question No3 from Questionnaire Analysis: From the above data it is clear that 43. 23.33% of respondents are settled in business of 1 years or less.00% of respondents are settled in business of 2 years or less and 13.
Sl No. of Percentage 60% 40% 100% Respondents Yes 18 No 12 Total 30 Source: question No. Bannerghatta Road Bangalore . TABLE 5: showing commodity market is a safe investment avenue for retail investors. 1 2 Particulars No.Gold as an a investment option in commodity Market Analysis: from the above data we can say that. Interpretation: From the above we can make out there is a mixed opinion regarding investors’ knowledge on commodity derivatives market.5 from Questionnaire 41 AMC Engineering college. 16 respondents have the knowledge of derivatives in commodity market & 14 respondents lacks the knowledge of derivatives in the commodity market.83 .
Reasons No.Gold as an a investment option in commodity Market Analysis: From the above table it is clear that 60. ts 4 9 7 1 21 of Percentage Responden 1 2 3 4 Number of investors Low risk Rate of return Any other Total 19.06% 42.76% 100% 42 AMC Engineering college. And 40.00% are telling that not safe for investment.33% 4. gold is a safe investment avenue for majority of investors. TABLE 6 : showing reasons for commodity preferences Sl.83 .85% 33. Bannerghatta Road Bangalore .No.00% of respondents are telling that it is a safe for Investment Avenue. Interpretation: From the above analysis we can say that.
85% Any other Analysis: from the above table it has been noticed that.83 . Bannerghatta Road Bangalore .Gold as an a investment option in commodity Market 4.33% 19.35% of respondents are investing commodities due to low risk.33% of respondents are investing in commodities due to rate of return.86% 19. 1 2 3 4 Highly Volatile Volatile Stable Un Stable Total Particulars No.58% 42. Interpretation: From the above table it is clear that the most of the investors who prefers specific commodity due to low risk.06% of respondents in commodities due to number of investors in such commodity. 19. & 4.53% 100% Respondent 43 AMC Engineering college. TABLE 7: showing the price voilality in gold market Sl No . 42.76% 33.07% of respondents for any other reasons. 33.06% Number of inv estors Low risk Rate of return 42. s 06 09 04 02 21 of Percentag e 28.05% 9.
& 9. TABLE 11: showing kind of analysis effective for investment decision SL.53% of respondents say’s that gold market is unstable. Interpretation: It can be clearly said from the above table.58% 19. 42. Bannerghatta Road Bangalore .86% of respondents say’s that gold market is volatile. 28.Gold as an a investment option in commodity Market 9.86% Analysis: from the above data it can be said that. 19. that investors feel Indian Gold market is volatile.NO 1 2 3 ANALYSIS Fundamental Technical Both TOTAL RESPONDENT S 5 5 10 20 PERCENT 25 25 50 100 44 AMC Engineering college.58% of respondents say’s that gold market is highly volatile.83 .53% 28.05% of respondents say’s that gold market is stable.05% Highly Volatile Volatile Stable Un Stable 42.
1 2 3 4 Particulars Highly volatile Volatile Stable Unstable Total No. 12 from Questionnaire 45 AMC Engineering college. 50% of respondents say’s that.86% 28.83 .58% 19. Respondents 09 06 04 02 21 of Percentag e 42. that investors prefer both kind of analysis to know the price trends in the market. Interpretation: It can be clearly said from the above table. both kind of analysis are effective.00% TABLE 12: showing opinion about commodity derivatives market in 50% Source: question No. india Sl No.53% 100. Bannerghatta Road Bangalore .Gold as an a investment option in commodity Market No. & 25% of respondents say’s that technical analysis are effective. 25% of respondents say’s that.05% 9. fundamental analysis are effective. of respo Analysis: From the above data it can be said that.
00% of the respondents are aware of commodity trading & 23% of the respondents are unaware of the commodity market. 23.Gold as an a investment option in commodity Market 9. commodity market is stable.05% Highly volatile 42.33 of the respondents are settled in investing business less than 6 month.86% of respondents say’s that. commodity market is volatile.58% Analysis: From above table it can be indicated that.33% of respondents are settled in business of 46 AMC Engineering college. & 9. Interpretation: It can be clearly said from the above table.83 . 28. SUMMARY OF FINDINGS Primary Findings 1) 77.58% of respondents say’s that.05% of respondents say’s that. 2) 70% of respondents are dealing in the commodity market & 30% of the respondents not trading in the commodity market. Bannerghatta Road Bangalore .53% 19. This may be due to resent fall & rise in commodity market. 19.86% Volatile Stable Unstable 28. commodity derivatives market is highly volatile. 42. that investors feel Indian commodity derivatives market is highly volatile. 3) 43.53% of respondents say’s that commodity market is unstable.
58% of respondents say’s that. 28.35% of respondents are investing commodities due to low risk. Secondary findings 47 AMC Engineering college.83 .58% of respondents say’s that gold market is highly volatile.53% of respondents say’s that gold market is unstable.05% of respondents say’s that gold market is stable. & 4. & 9.00% of respondents are settled in business of 2 years or less.00% are telling that not safe for investment. 19. 4) 53.05% of respondents say’s that. 8) 50% of respondents say’s that.67% respondents lacks the knowledge of derivatives in the commodity market.86% of respondents say’s that gold market is volatile.53% of respondents say’s that commodity market is unstable. fundamental analysis are effective.07% of respondents for any other reasons 7) 42. 33. 19. 9) 42.06% of respondents in commodities due to number of investors in such commodity. 6) 42.Gold as an a investment option in commodity Market less than 1 years & 20. 19. 28. commodity derivatives market is highly volatile. & 25% of respondents say’s that technical analysis are effective. 25% of respondents say’s that. 5) 60. commodity market is volatile. both kind of analysis are effective.33% of respondents are investing in commodities due to rate of return. Bannerghatta Road Bangalore .86% of respondents say’s that.00% of respondents are telling that it is a safe for Investment Avenue and 40. commodity market is stable.33% respondents have the knowledge of derivatives in commodity market & 46. & 9.
This translated to an increase of 14% in tonnage terms. 22% below the level of supply in 2004. 5) Investment demand in 2007 was 7% higher than in 2006 in tonnage terms and 45% higher in dollar terms. spurred by a 27% year on year tonnage increase in holdings of gold Exchange Traded Funds and similar products. this was equivalent to a 25% increase bringing the value of gold demand in India to a second successive annual record.83 . The fourth quarter was particularly strong with a 19% rise in tonnage terms and a 51% increase in dollar terms. 2) In 2006 the investment demand was 26% higher than a year earlier in tonnage terms and 37% higher in value terms. In the 48 AMC Engineering college. Overall jewellery demand in 2006 was 5% higher than 2005 in tonnage terms and a substantial 14% higher in dollar terms. accounting for 589 tonnes.Gold as an a investment option in commodity Market 1) In 2005 consumer demand was 10% higher in tonnage terms. in India retail investment were is 16% higher than a year earlier. In rupee terms. Jewellery demand rose 14% in dollar terms in 2007 as a whole. The supply of gold to the market was sharply reduced from one year earlier at 828 tones. 3) Overall consumer demand in India in 2006 was 17% higher in tonnage terms than the year before. but fell back by 16% in tonnage terms due to a volatile gold price in the first half of the year. 4) Jewellery demand also experienced a second successive annual record of over 20% in rupee terms over 2005. Bannerghatta Road Bangalore .
demand rose by 7% in tonnage terms and 45% in dollar terms to set a new annual record. Q4 2008 saw record levels of inflows at US$8 billion. 7) Gold supply was tight in 2007. but the last quarter was heavily impacted by price 49 AMC Engineering college. and to a sharp increase in producer de-hedging. 6) Industrial and dental demand reached a new record in both tonnage and dollar terms in 2007. In dollar terms the year on year increases were 45% for the category as a whole and 51% for electronics. which also established new annual records. Tonnage figures.451 tonnes. identifiable gold demand was 4% higher in 2008 than in 2007 at 3. 8) According to World Gold Council’s (“WGC”) Gold Demand Trends. falling 13% from 2006 levels to 3. rising 11% in tonnage terms to 312 tones. Net retail investment. in the form of bars and coins was up 2% year on year in 2008. Bannerghatta Road Bangalore . Mine output contributed a further 56 tonne reduction. the highest quarterly level in recent years. This was due to vibrant demand from the electronics sector. These factors reduced overall supply by 657 tonnes.547 tonnes. due to a sharp reduction in net central bank selling.Gold as an a investment option in commodity Market industrial sector.83 . 9) In the investment sector. up 7% on 2006 at 458 tones.
up 2% on 2007. Return from “buy and hold” strategy should be more than sufficient to compensate for the inherent volatility. Net retail investment in Q4 at 67 tonnes was 39% lower than Q4 2007. diversified portfolio should be 0 to 3% during a gold bear market and 5% to 10% during a bull market.Gold as an a investment option in commodity Market movements as investors took profits. SUGGESTIONS & RECOMMENDATIONS: Gold is very sensitive metal because the price of gold is determined from the international activities. bar chart. Bannerghatta Road Bangalore . So a reasonable allocation in a conservative. In candle stick one should look for the resistance and support level of the price where he will able to judge the range in 50 AMC Engineering college. 13887 in 2008. 11) The moving average trends shows that the gold price indicate the bullish trends in the market & the gold price may go beyond Rs. line graph. Recommendation to the investor of gold is that excessive reliance on trading strategies to generate returns can be dangerous and counter productive. Hence it may be sold. As an investor one should look technical chart like candle stick. 12) The RSI is 44. 10) Industrial demand reached a record 465 tonnes in 2008. the gold is over priced.83 .243.
Investor should not fully rely on the news because any news come to market has already been discounted the big giants always get the news before it reaches the market. 51 AMC Engineering college. symmetric triangle on which one should also look for the breaking or high of the price so that he will be able to take decision were to enter were to exit. In my view most attractive investment in gold is through GETF. news paper is late and market has already reacted for that news. descending triangle. Bannerghatta Road Bangalore .83 . which in turn involves low risk. For being on the safer side an investor should always enter into the market with hedging or arbitraging option cause that will assured the investor with a reasonable profit. there are different formations in candle stick like ascending triangle. so it is very easy way of investing in gold. That means the news that come in television.Gold as an a investment option in commodity Market which the price lies. GETF is easy way of purchasing gold because we have to pay only one-tenth of the price of gold.
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