Investors ignore gold, securities

Gold and securities, once the most attractive investment options for many people, are no longer the top choice as minor price fluctuations bring tiny profits.

In previous days, people rushed to purchase and sell gold when the ‘gold price wave’ towered. Investors profited hugely by buying when the price was low and selling when the price rose. However, others lost a lot of money surfing this wave and, since then, gold has become less attractive.

Gold loses luster

Financial analysts point out that these losses are just one reason that investors are ignoring gold. The main reason that investors are looking past gold is that price fluctuations are small and will not allow them to profit quickly.

Previously, gold price increases and decreases were predictable, shifting in accordance with economic laws. The gold price went down to certain levels and then rose sharply again. The clear status of the national economy also helped investors easily forecast the gold price performance.

Since then, the European debt crisis and the US economic woes have made the gold price move irregularly, no longer following economic laws (in principle, the gold price comes contrary to the dollar price), but rather in accordance with investors’ feeling.

In late June 2010, the gold price climbed to 28.7 million dong per tael when the world price reached $1260 per ounce, and then dropped to 28 million dong per tael. On July 9, gold traded at 28.15 million dong per tael (purchase) and 28,22 million dong per tael. These minor price shifts are not big enough to lure investors who think find it very difficult to predict the price bottoms and peaks.

Securities become insecure

Since mid-May 2010, the stock market has hovered around 500 points, though securities experts believe that the market will recover and grow strongly, thanks to positive economic indexes.

Previously, the domestic stock market operated independently of the world market. In many consecutive trading sessions, the VN Index and HNX Index increased despite world market decreases. Nowadays, the domestic market has more closely performed in accordance with the world market.

The world market has been shaken by the debt crisis in Europe, and investors have doubts about the recovery of the national economy, so securities have become much less appealing. Investors do not barter away stocks to flee from the market, because they have much more experience and knowledge about securities.

Hesitant investors have made the securities index unable to rise. After climbing to 549.61 points on May 6, the VN Index has been declining continuously and the closing index dropped to 496.91 points on July 7. On July 9, when the world stock market recovered strongly, the domestic market recovered only slightly, due to rumors that a large investment fund might withdraw its capital.

Securities companies complain that it is very difficult to define market tendencies because investors’ feelings depend so much on outside factors. If the world market performs well, the domestic indexes will not drop dramatically, and vice versa.

Dau tu chung khoan

Tags: vietnam gold, vietnam stock, Vietnam stock market