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COMEX gold, or gold futures, are a common way for professional money managers to gain exposure to goldâs upside on behalf of their clients. Gold has been a standard component of a diversified portfolio from time immemorial. However, in times of increasing uncertainty, gold also becomes a prominent place of refuge. Indeed, investors routinely seek recourse to precious metal for stability, and many are even turning to paper proxies like the Public Bank Gold Investment. COMEX Gold In Light Of The Overall Case For Gold Gold has always been a store of value. As a basic, relatively rare, and universally valued commodity, gold has been ubiquitously recognized as âreal money.â Gold functions well as a hedge against inflation too. Particularly in times when interest rates are low, or even negative in real terms, gold does exceptionally well. In fact, gold can not only retail value, but also rise significantly in the face of devalued currency. So, gold can be an excellent investment too. After gold rose for 10 straight years in the beginning of this century, an increasing number people began to take notice. Despite record highs in nominal terms, gold remained relatively low in inflation-adjusted figures, and the variety of products for gold investing grows. Unique circumstances never before seen in the history of humankind render gold a critical component of any investment portfolio. Futures contracts offer a handy way to tap gold. Prices are conveniently quoted in U.S. Dollars. Minimum price fluctuations are 10 cents for every troy ounce. Trading ends on the third last business day of the month prior to delivery. The gold at issue is geared to assay to at least .995 fineness. With COMEX gold so widely talked about, letâs take a look at it via the âLLCâ method of evaluation. COMEX Gold And The Tremendous Liquidity COMEX gold futures post a typical daily volume of somewhere north of two hundred thousand contracts. This equates to somewhere in the neighborhood of 20,000,000 ounces of gold that change hands every day. As you can see, the market is extremely large. Moreover, there are about 50,000,000 ounces of gold that are tied up in open position. Keep in mind, of course, that most of this is simply electronic transactions. Indeed, less than 10% involves physical metal, so the ease of trading makes for a liquid market thatâs quite efficient. There are plenty of market players, who have access to real-time quotes. The market features tight bid-ask spreads and an open pricing structures thatâs appealing to investors.
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