Investors are going for gold.
With escalating trade tensions, and risings fears of a global recession, many folks are flocking to the safe havens of gold. In fact, ever since the trade war began, gold prices have rallied from a low of $1,275 to a recent high of $1,530.
However, this may only be the start of a much bigger move.
Goldman Sachs for example believes it could rally to $1,600 over the next six months, given the dimming global economic outlook, fueled by heightening trade tensions. “If growth worries persist, possibly due to a trade war escalation, gold could go even higher, driven by a larger ETF gold allocation from portfolio managers who still continue to under-own gold,” Goldman analysts said, as quoted by Bloomberg.
Analysts at Bank of America Merrill Lynch say the metal could climb toward $2,000 in the next two years, as “the recent dovish tilt by central banks, accompanied by increases of negative yielding assets,” as also quoted by Bloomberg. UBS Group AG and Citigroup Inc. are also bullish on gold, forecasting prices could rise to as high as $1,600.
Then again, gold isn’t the only trade benefiting as a safe haven.
Investors are Also Flocking to Gold ETFs
In fact, some of the top ETFs drawing attention are the SPDR Gold Shares ETF (GLD), the VanEck Vectors Gold Miners ETF (GDX), and GraniteShares Gold Trust (BAR).
To be honest, an ETF offers you more for less, with greater diversification.
For example, the GDX ETF trades just under $30 a share, and offers you diversification with stocks such as Newmont Goldcorp Corporation, Barrick Gold Corporation, Franco-Nevada Corporation, Kirkland Lake Gold, and Royal Gold Inc.
If you were to buy each of those stocks individually, it’ll cost you much for than $30.