Why Central Banks Are Loading Up On Gold And How Can You Follow Their Lead

“Gold has gone up by almost 70-80% in the last five years and almost doubled from the lows of 2016… [and] still remains undervalued against most front-line assets like equity and other commodities with the exception of steel and silver.” -Vikram Dhawan, a fund manager with the Nippon India Mutual Fund.

There are many reasons why central banks are buying gold, but the top two ones include having no default risk and it being undervalued compared to certain equities. The prices have been known to spike especially in the face of crises like the 2008 and March 2020 COVID-19 crash.

For example, gold went up 24% and 27% during these times, respectively. 

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