To outsiders, Dubai’s eager procedure for wealth and its fascination with glitz is amongst the city’s most intriguing traits. And while there is more for the emirate than supercars and cheap diamonds, the actual fact remains that, as one of the world’s great gold trading hubs, our city is the place to adorn yourself with riches.
In July 2013, gold posted its worst quarterly drop in 113 years. Without any tax in the precious metal, Dubai is a great location to buy it, but does that mean it’s a worthwhile investment? Possibly not, in accordance with Keren Bobker, senior financial consultant at Holborn Assets.
‘Unless someone features a crystal ball it’s impossible to predict if gold is a superb investment,’ she says. ‘The price may be volatile and there is no guarantee which you can make any cash.’ Unlike many investments, including shares and property, you can’t take earnings from it adds Keren. ‘I’m more concerned that individuals build-up their savings inside a diversified portfolio for his or her long term benefit, than speculate on Regal Assets Dubai review. It should be kept as not more than 5 percent of the total investment assets,’ she adds.
If you do decide to invest in gold, don’t be fooled into stocking on gold bars in one of Dubai’s gold dispensers (you’ll locate them in Atlantis, The Palm and The Dubai Mall). ‘It seems very gimmicky,’ says Keren. ‘A serious investor is not really going to buy from a machine, so I imagine it’s even more of a tourist souvenir, especially when considering where a lot of the machines are.’ Instead, Keren suggests you head straight to the jewellery shops. ‘The most frequent way is probably by purchasing jewellery. This is largely sold by weight inside the UAE [untrue elsewhere], and also the workmanship can raise the price,’ she says. The greater number of intricate the design, the more you are likely to pay.
Gold bullions can be purchased at the gold souks and certain banks, including Emirates Gold, Al Abayad Jewellers in Sharjah and Credit Suisse, and also online dealers. ‘You can begin having a coin (some kind of special UAE ones exist) costing under Dhs1,000, a very small bar of just an ounce, or move all the way around massive bars weighing several kilos,’ she says. ‘Bullions must be saved in a bank vault, not in your house.’
So when is the best a chance to buy gold? ‘If only I could possibly predict that,’ says Keren. ‘The best time happens when charges are low, which means you must keep watch over the current market,’ she says. But investors ought to be conscious of indicators which give rise to the fluctuating price of gold, including sentiment, governments buying to sell rega1 reserves and once equity costs are volatile. As for selling, Keren says holidays are usually a good time to strike. ‘You may see some small surges at times of holidays when gold is traditionally bought in many countries,’ she says. ‘India will be the world’s biggest gold importer as well as a lot is purchased at Diwali and Akshaya Tritiya, as well as during Eid within the Muslim world.’
India may be the world’s biggest importer, but there is often little understanding why Dubai is amongst the best places to buy gold. ‘It’s to some extent due to historical reasons and due to sheer amount of trade here. Both Arabs and Indians have historically been interested in gold instead of putting profit the financial institution,’ she says. ‘In many cultures this has been tradition for a woman to use your family wealth, particularly ahead of the development of safe banking. Some traditions die hard.’
For all those eyeing gold for an investment, Keren reiterates her view that it’s fundamental to proceed with caution. ‘When being bought for investment it ought to be considered an assets class like any other along with the key to a well-balanced investment portfolio is diversification. Never place all your hard earned dollars into one asset.
That’s incredibly risky once you have no power over market prices,’ she says. But given that you’re in Dubai, there’s no harm in adding the odd piece to the jewellery collection.