We Ask , Why Hold Gold

Because gold is visually pleasing and workable and does not tarnish or corrode, it was one of the first metals to attract human attention.

Examples of elaborate gold workmanship, many in nearly perfect condition, survive from ancient Egyptian, Minoan, Assyrian, and Etruscan artisans, and gold continues to be a highly favoured material out of which to craft jewellery

and other decorative objects.

Can Gold be Used as a Currency?

It is always worth considering that anything can fulfil the basics of trade, as bartering has proved through centuries. The basic proviso is that as long as the person you are trading with is happy with what you are offering in trade, than the barter can work. In this arena, we can certainly that the store of wealth mechanism of gold can be realised, just as much as if you were to sell gold.

What is the difference between barter and a currency?

However, currency is a little different, it is a store of value that has a definition of that value that is commonly agreed and is used as a proxy or intermediary for the value of work or goods in a transaction. In this way gold, with a known value by weight is a financially sound currency.

Gold vs fiat currency

Unlike a fiat currency such as pound sterling or the US Dollar however, gold has a value of its own, that is not illusory or based on an intangible. Gold is real, and its value, although sharply increased over the past 40 years, has outlasted countless dynasties and rulers with value intact.

However, gold is rarely used as a method of payment outside of certain nations in Asia and Africa. It's use as a currency is often the preserve of turbulent regions and failed states. It achieves this feat, precisely because of its value in facilitating trade when internal order is broken down.

The gold trading market is the biggest market of all the precious metals, due to its exceptional value storage properties and numerous industrial uses. It is often viewed as a ‘safe haven’ for investors and is in demand during times of economic uncertainty.

Inflation protection In times of high inflation, the gold trading price tends to remain stable, so anyone worried about inflation typically considers buying gold. Diversification Gold is an excellent way to add a bit of stability to an investment portfolio as it cannot be substantially devalued, unlike currencies or stocks. Crisis immunity Gold is immune to geopolitical crises and tends to resist dramatic swings in Forex prices and stock market prices. Volatility As many commodity markets, gold is quite volatile in the short term. Additionally, substantial price spikes occur every few years when the demand for gold outpaces availability. Accessibility With gold CFDs, you can trade the changing price of gold without having to physically buy gold. Plus, you can also trade a range of gold-related assets, like gold shares (shares in companies involved in the extraction of gold)