According to a representative of the World Gold Council, Vietnamese individual investors are increasingly taking risks, but that does not mean they are less interested in gold.
According to the report “Gold demand trends in the third quarter of 2021” released by the World Gold Council (WGC) recently, gold consumption of Vietnamese consumers decreased by 50% compared to the same period last year. In which, the consumption of gold jewelry, gold bars and gold coins are halved, remaining one ton and two tons, respectively.
According to Mr. Andrew Naylor, Managing Director of Asia – Pacific (excluding China) of the World Gold Council, the main reason is just social distancing that affects the demand to buy gold. Therefore, when the epidemic is under control, the expert predicts that the demand for gold will increase again.
“In this market, retail investors’ demand for jewelry and gold remains and increases when the Covid-19 situation is under control, vaccination rates increase and domestic GDP is more stable.” , he said.
However, in Vietnam, The attraction of other investment channels is considered more attractive than gold. In the stock market, last week VN-Index had a series of 4 consecutive increases, ending Friday’s session (October 29) with a new record of 1,444.27 points.
Meanwhile, in the digital currency channel, digital currencies are having a good month. Bitcoin price has increased by nearly $20,000 in the past month, now trading around the $62,000 mark compared to $43,000 on October 1.
“Recently, Vietnamese and international investors tend to invest more in high-risk assets. But that doesn’t mean they lose interest in gold,” Mr. Andrew Naylor said. .
This expert analyzed, digital currency and gold are two types of assets, two completely different investment channels, so the investment needs are also different. Cryptocurrency is a rather risky and risky channel, but because it is new, it attracts many risk-loving investors.
Gold is different, with more diverse needs. Gold is used for jewelry, applications in the technology industry, and as a reserve for central banks. Therefore, gold is always included in the portfolio of investors to balance the level of safety, as well as diversify the portfolio.
“Therefore, when investors are exposed to risk, they also have a need to balance that risk with safer collateral assets like gold. Therefore, they will balance their portfolios.” your own money, in both gold and digital currency,” he said.
Not only stock and crypto channels, more traditional channels such as real estate are still considered attractive despite slowing down because of Covid-19. Survey of VnExpress Once shown that, from the first outbreak of Covid-19 in Vietnam at the end of the first quarter of 2020 to the fourth outbreak, the asking price of real estate has increased steadily in the primary market.
Even during the lockdown period, the average increase in asking prices of condominiums and mainland real estate (land plots, townhouses, villas) in Ho Chi Minh City recorded 10-15% year-on-year, respectively. .
With prospects in all three channels of securities, cryptocurrencies and real estate, Mr. Andrew Naylor assessed the positive point that individual investors in Vietnam now have many investment options. However, according to him, it should be understood that investment channels such as cryptocurrencies or securities are highly volatile, while real estate and gold are tangible assets, compared to the other two channels are somewhat intangible.
Real estate differs from gold in lower liquidity. Because gold is both a tangible asset, has strong liquidity, and is an essential commodity when used a lot in electronic and telecommunications components.
“I recommend a balance of investment portfolios, including high-risk, low-risk and no-risk investment products, those with no margin and high margin. And so, Risk and return will be guaranteed steadily,” he said.
Reply VnExpress Regarding the experience for individual investors in the context that there are many promising channels, Mr. Andrew Naylor recommends following the motto “small and regular amounts”, ie monthly investments should be made.
“Every month, we spend a certain amount to invest in a product. We should invest evenly and driply instead of rushing to buy immediately at a certain price in large volume. When buying small and evenly, we We have divided the risk equally among the months and applied the investment value balancing method,” he suggested.
With that, for the gold trading and investment market in Vietnam to develop, the expert suggested two aspects.
On the retail side, He hopes to soon have an electronic trading floor to invest in gold. Commercial banks that can open this channel can easily attract customers to buy gold and send it back to the bank.
“According to market research, Vietnamese people are very interested in buying gold online. They can buy small amounts of gold (rings or small gold coins) every month instead of going to the official store to buy a large quantity once. This direction brings benefits to customers, banks, gold houses, mobilizing idle money from them”, he analyzed.
In terms of investment, The financial investment market in Vietnam is still quite young, so there is a need for more channels to attract capital. The important thing is that institutional investors can participate in gold ETF investment, can both buy actual gold and trade the amount of gold they buy. This will increase the liquidity for the amount of gold they hold.
Not only Vietnam, the world’s gold consumption demand in the last quarter also decreased, by 7% over the same period in 2020 and down 13% compared to the second quarter, to 831 tons. However, Mr. Andrew Naylor assessed, in the short term and long term, the demand for gold still increased in both consumption and investment.
“Currently, interest rates have a negative effect on the demand for gold. But soon, when the economy recovers, inflation becomes more stable, prices of basic commodities are adjusted, leading to demand for gold. will increase,” he expressed optimism.
In the past week, information about US GDP in the third quarter was lower than expected and the ECB kept interest rates unchanged, creating favorable conditions for gold prices, as institutional investors in North America, Japan and Europe tended to buy more gold. Particularly on October 28, the world gold price fluctuated sharply, reaching $1,810 an ounce at one point, before returning to trade around $1,783 an ounce on the evening of October 29 (US time).
However, the money flowing into the gold market is also dominated by stocks. Closing the session on October 29, the S&P 500 index gained 0.19%, continuing to set a new record with 4,605.38 points; The Nasdaq index rose 0.33% to 15,498.39. The Dow Jones Industrial Average rose 0.25% to 35,819.56 points.