Gold Rush: Price Reaches 6-Year High

While nervous investors watched for stock market fallout from last week's downing of a U.S. military drone by Iran, the incident had a decidedly positive effect on the commodities market. Crude oil prices rose modestly, but gold took a huge leap. Thursday saw the biggest single-day increase for gold prices since 2016, up more than $48 an ounce. On Friday, gold closed at $1,410 per ounce, its highest price since September 2013. Along with the international tension, the Federal Reserve's signal of possible interest rate cuts (and at least no more rate hikes) this year also helped to boost gold.

Gold is consistently one of the most polarizing investments among financial experts. While some celebrate it, others have warned of its risks. Michael Smith, president of STA Wealth Management and co-host of the STA Wealth Management Show on KPRC AM 950, says gold should at least be part of the conversation for investors. "You didn't even want to talk about gold in the past several years, however I think it's now becoming more exciting," he says on the show.

Smith tells listeners that in today's volatile world, a little gold can be a good thing for an investor. "Gold's got a specific place, and it's certainly not for half your portfolio or anything ever close to that---it's more like five percent or less---but it's there as a currency hedge," he says. "Investors should at least be looking to allocate some to gold, for various reasons...basically if you think currency and the dollar and all of these various things are going to be somewhat volatile in the coming years, (gold) can be a great place to diversify away from them."

Gold bars are displayed at Shinhan Bank

Sponsored Content

Sponsored Content