Throughout history, people have made gold investments. It is a tried-and-true asset class that investors seek to diversify their portfolios with. Individual and institutional investors commonly use spot market for gold to profit from price volatility.
Another appealing feature of trade spot gold (เทรดทองคำ, term in Thai) is that, like any futures trading, no need to retain real gold — only a piece of paper will suffice. Go-Trade Company can also help you to learn all about spot gold trading.
Buying or selling your gold at the current market price is known as spot gold trading. In spot gold trading, there will be no brokers or market makers. The spot gold market will be an online marketplace where buyers and sellers can transact directly.
Spot gold traders may buy and sell fractional gold bars, ingots, and coins. Small investors can now trade spot gold at a reasonable price.
The following are the steps involved while trading on spot gold.
- Opening of an account with any foreign company that is offering spot metals trading
- Opening with the company you selected, an online account, and request for a demo account too
- Start demo trading by selecting the London, Zurich, or New York spot gold markets for trading
- Look at your bid and ask prices
- Enter a trade by using your demo account as per your perception about the gold price where it is heading.
- Fund your account and start trading.
What is trading on spot gold?
Trading spot gold allows you to always diversify your portfolio and protect yourself against market inflation and volatility. Investors have long embraced gold as a means of diversification, and the spot exchanges of the country assist them in this endeavour.
Spot gold markets allow you to buy and sell gold in the currency of your country. Typically, prices are mentioned for 10 grams of 24-carat gold. If you acquire gold bullions on the spot market, you can profit from rising interest rates.
For example, suppose you bought gold today for 30,000 Baht and sold it the next day for 30,500 Baht. On every purchase of 10 grams of gold on the spot trade, you might have made a profit of 500 Baht. If prices fall, you can keep the receipt for a longer period of time to reduce your losses.
Purchased commodities can be settled by either selling your purchased quantity to another investor or obtaining actual gold from the storehouse.
You need not pay the whole price to buy a commodity in spot trading; you can also become an owner of the quantity by just paying an initial margin amount as a “good faith deposit.” Typically, the deposit is a tiny proportion of the total contract value.
There are a number of other advantages of spot gold trading, and the trading tactics can be tailored to your risk tolerance.
In the spot markets, you can always place buy orders, or “Asks,” or sell gold, or “Bids.” If you believe gold prices will rise, you can purchase the commodity at “Ask” pricing and benefit if prices rise. Similarly, you can sell gold at a “Bid” price if you believe its value will fall. You stand to win if prices fall.