As gold surged above $1,000 Friday, solidifying its position as one of 2009’s best assets to date, investors wondered if now is the time to buy or if they’ve already missed the boat.
Guests Jim Steel, chief commodities analyst at HSBC, and Kevin Kerr, editor of Global Commodities Alert, joined CNBC to give their take on this latest market trend.
Kerr believes that gold has hit a new benchmark and will likely continue on to $1,500 in the coming months. He is skeptical of the commodity’s ability to reach the $3,000 mark predicted by others, but explains that people still have ample opportunity to get in the gold market.
“In the equity space, I like a miner like Jinchuan, it’s a Chinese miner. There are a few out there. I’d be very cautious, I lean more towards trading the options on gold,” Kerr said. “I like to stay as close to the underlying metal as I can and even owning some actual, physical metal might not be a bad idea either.”
Watch the video below to see what the analysts had to say about gold
Steel agreed that gold will continue to rise in the near future, but believes that should not be the only incentive to invest in the commodity.
“Whether the gold market goes up or not, it’s actually still an excellent portfolio diversifier. It’s the only asset that you can buy that is conversely correlated to paper assets. So even if the gold market were to go down, I would argue that it’s still a very valid investment because of the protection that it affords,” Steel said.
Disclosure information was not available for Steel, Kerr or their respective companies.
Major Gold & Gold Miner Securities:
SPDR Gold Trust ETF