Showing Your Metal: Investing in Gold, Silver and Copper
It may have been a volatile year for precious metals, but the global financial crisis has made investing in the most conventional markets even more difficult. As the price of gold continues to rocket, and other metal prices seem strong, CNBC asked three industry professionals: should you put your pedal to the metal?
"Copper is the most important industrial metal. If we invest in copper, its requirement is going to be increased," Anil Kumar of commodities group Vincom Worldwide told CNBC. "We do understand that copper has a limited supply, but the way the world is growing means a lot of copper for the growth."
Kumar said that provided copper works on fundamentals — rather than being influenced by troubles in Europe — it shouldn’t go below $8,000 per ton in the near future.
Walter De Wet from Standard Bank offered his opinions on the value of traditional gold investment, saying that gold not only trades as a currency — particularly as an alternative to the current risks associated with the dollar and euro — but also provides both a hedge against inflation and trades inverse to the economic cycle.
"In all the recessions since 1981, gold has always ended recessions higher than where it started," De Wet said.
"We remain bullish on gold," he added. "We think that gold will continue to move higher into 2012."
De Wet has a target price of $2000 an ounce for the first quarter of next year and an upside of as high as $2,200.
Philip Newman of precious metals research consultancy GFMS predicted a $40 price for silver in the fourth quarter, and explained that 2012 would see further strength for the metal.
"Silver has different attractive qualities depending on the investment class. For institutional investors, silver’s greater price volatility can be an attractive quality. For retail investors, the relatively low cost of buying silver can also be an attractive quality," Newman said.