Since the beginning of 2025, driven by concerns about inflation, trade war risks, and geopolitical tensions, the price of gold has been on the rise, reaching over $3,500 per ounce at one point. With the unfolding of trade negotiations between the U.S. and China, the price of gold has slightly retreated. So, what are the key considerations for those looking to invest in gold at this point?
To understand the fluctuations in gold prices, we need to look back to early 2024. In January 2024, the price per ounce of gold was $2,063.73, just breaking through the $2,000 mark. However, by early June 2025, the price of gold was approaching $3,400, which is more than $1,300 higher than the level at the beginning of 2024, representing an increase of around 65%.
Given the significant surge in gold prices, potential investors may approach the gold market with caution. However, due to gold’s stable value as an effective hedge against inflation and a tool for portfolio diversification, gold still holds allure for many investors.
Amid global economic uncertainties, as geopolitical tensions persist and concerns about potential economic slowdown loom, many investors are turning to safe-haven assets like gold for stability. In times of heightened risk and volatility, gold often benefits investors as capital flows from riskier assets like stocks to safer havens.
Nevertheless, the current high price of gold warrants careful consideration even though gold remains a worthy investment. It is essential to invest in gold in a financially efficient and relatively secure manner.
According to a publication by CBS News, there are three key gold price issues that investors should consider when investing in gold at present.
While waiting for gold (or any asset) prices to drop before investing may seem appealing, prolonged waiting poses its own risks. Over time, gold prices (excluding minor fluctuations) generally continue to rise. Waiting for a cheap entry point might not be wise as such opportunities may be rare. Furthermore, waiting means missing out on the protection gold can offer to an investment portfolio, which becomes particularly crucial in times of uncertainty in the stock market.
Therefore, if one can afford a small investment in gold, waiting may not be worthwhile.
The exact timing of when the value of any asset will change is uncertain, but in June this year, gold prices may experience some volatility.
Gold prices may react to the release of the next inflation report or monetary policy decisions by the Federal Reserve. Based on the May inflation levels indicated in the Federal Reserve report or their stance on interest rates, gold prices could significantly rise or fall.
For those determined to invest in gold and seeking the right timing, paying attention to opportunities to invest in gold in June is crucial.
Even with rising gold prices, investors can still invest in fractional gold ounces, or employ dollar-cost averaging (regularly investing small amounts of money) in gold. This means that the maximum investment in gold should not exceed 10% of the overall investment portfolio. Depending on an investor’s characteristics and budget, this percentage may be even lower than 10%.
In essence, investing in gold at present requires establishing a price point that one can afford while adhering to common advice on limiting gold investments to allow other income-generating assets to perform as expected. However, practically speaking, this suggests that at the current high price levels, the proportion of gold investments in the overall portfolio might be lower than during periods of gold price downturns.
In conclusion, the CBS article emphasizes that while the three gold price issues mentioned above are crucial, they are not the only factors potential investors need to consider, especially for those contemplating investing in gold for the first time. Therefore, alongside contemplating these three issues, seeking advice from financial advisors or gold investment companies can be helpful.
(This content is for general informational purposes only and is not intended as recommendations. Dajiyuan does not provide advice on investments, taxes, law, financial planning, real estate planning, or other personal finance matters. For specific investment decisions, consult your financial advisor. Dajiyuan does not bear any investment responsibilities.)