KUALA LUMPUR: Budding investors looking to invest in gold prices should invest in gold bars instead of jewellery, according to the Malaysia Gold Association (MGA).
MGA president Louis Ng said for individuals who have never invested in gold before, it is advisable to consider purchasing gold bars rather than jewellery.
"Speculating on gold prices can be risky, especially when using margin or gearing. Price corrections in the gold market can be severe, leading to significant losses for speculators."If you are new to buying physical gold, buy the small ones with a cheaper price tag and affordable price. Some people buy large pieces of gold and pay them in instalments. This is not advisable," he told Business Times.
Ng recommends investing in smaller denominations, such as five or 10 grammes to start with, and pay in full rather than using leverage, which minimises the risk associated with speculative trading.
He said should pay in full rather than using leverage to minimise the risk associated with speculative trading.
Gold is often described as a 'safe haven' investment in times of volatility.
Ng however said it is important to exercise caution and prudence when navigating the gold market, especially during times of volatility.
"While there are opportunities for profit, there are also inherent risks that investors must be mindful of," he added.
A number of jewellers have taken to selling gold jewellery at more than RM400 per gramme, as demand soars.
The price of gold, which is valued internationally in US dollars, hit a record high of US$2,431.29 per ounce on Friday.
U.S. gold futures settled 1.0 per cent higher at US$2,407.8 yesterday.
The physical price of gold as at 9.30am today rose RM1.55 to RM 354.91 per gramme from RM353.36 yesterday.