Gold and silver prices estimate a huge decline
If you recently Gold and silver Looking at the rising prices, thinking of investing in them, then stop a little. The country’s well-known investment expert and ICICI Prudential Mutual Fund’s Chief Investment Strategist S.K. Naren has clearly stated that at the moment it will not be a decision to buy gold or silver. A few months ago, Naren warned of a decline in the stock market and advised investors to stay away from the market and their point was proved to be absolutely correct. In such a situation, if this time also his guess is sitting right, then in the coming time, there may be a drastic drop in the prices of gold and silver.
Naren says that gold and silver have really performed well in the last one year, but this is currently making them risky. He said that the most important rule of investment is “Choosing the right asset at the right time”, but most people invest when an asset has already touched the height. The result is that the speed in which people invest in the greed, the same later turns into loss.
When everyone starts buying, then it should be careful
S. Naren called it “anti-asset allocation”, that is, the habit of investing at the wrong time. He says that many times investors invest in the previous performance of an asset and invest in it, but the previous performance is never guaranteed the future. Giving an example, he said that if silver had been purchased two-and-a-half years ago, it would have been a wise step because its prices were below at that time. But today when prices are at high, investing in the same asset can become a risk. They say that there is no interest in gold and silver, nor dividend comes, and they cannot be tested by any traditional financial metric like P/E ratio.
Do not invest heavy in the urge of high returns
Naren insisted that people are busy in the race to buy gold and silver at this time because they have given better returns from the stock market recently. But this thinking is the biggest risk. When an asset is at its highest level, investing in it increases the risk rather than returns. He says that in the past, he had already predicted the decline in the stock market, especially mid and small cap segment. Now they are giving the same warning with gold and silver.
What is the right way to invest?
Naren suggests that if you have to invest in gold or silver, make it a small part of the portfolio. Include these under multi-asset strategy, so that your investment remains balanced and safe. They believe that investment is not just a game of numbers, it is also a matter of behavior. The right investor is the one who buys when prices are falling and sells when prices are high. But common investors often reverse it. They buy at a high price and sell it cheaply in nervousness. This habit causes loss in a long time.
Disclaimer: This article is only for information and should not be considered as an investment advice in any way. TV9 India suggests its readers and spectators to consult their financial advisors before taking any decision related to money.