DUBAI GOLD: GOLD AS A ONE-OF-A-KIND ASSET

DUBAI GOLD | 30 DECEMBER 2024

Gold has always been seen as a valued asset throughout history. According to some of the oldest documents, gold was sought after as a medium of exchange and as an art form. Gold coins served as a crucial basis for our monetary system since they were first produced in approximately 550 BC. Nonetheless, gold-containing antiquities from as far back as 4000 BC have been found. This indicates that this asset’s significance has long been associated with wealth and power. The “gold standard” ensured that paper money maintained a significant connection to gold even after nations switched from using gold coins to more convenient paper money.

The very nature of what makes gold precious is the rarity and scarcity of the metal, something which has continued to fascinate people to this day.

But just how rare is gold? Consider this, gold is so rare that the world produces more steel in an hour than it has poured gold since the beginning of recorded history.

It also serves a variety of purposes. Approximately 25% of the gold used today is used for coins and bars, and more than half is used for jewellery, although gold is also used extensively in industry. The demand for gold is significantly influenced by technology, which is utilised in everything from cellphones to electric vehicles, along with other precious metals.

Since the price you pay is determined by the “premium” of the commodity, all gold investment options have comparable prices. This represents the proportion that the product’s price exceeds the gold price of the metal it contains. Smaller products typically cost a little more to produce, package, and deliver than bigger ones because of economies of scale. This implies that smaller products typically have higher prices. The real percentage charged on the smaller bar, over the price of the gold it contains, is therefore slightly higher, even though a 1g gold bar would be less expensive than a 100g gold bar (since they contain wildly disparate amounts of gold).

One of the most well-known valuable commodities in the world is gold. Gold transcends cultural barriers and has been used for many purposes throughout history, including coinage, handcrafted jewellery, and vital components for electronics. Gold continues to appeal to many investors as a unique asset that provides an alternative to traditional stock and bond markets.

BlogDUBAI GOLD: THE ALLURE OF GOLD AS A ONE-OF-A-KIND ASSET