World Gold Council says gold is 'not a volatile asset'

A report published today (September 25th) on MineWeb.com has claimed that the World Gold Council (WGC) has insisted that gold is not a volatile asset.

The yellow metal has often been described as such, a trend which harks back to President Nixon's closing of the gold window in the 1970s as prices caught up with the mechanics of a free-float.

However, the WGC has explained that since the spike of 1979-1980, gold has been markedly less volatile than the rest of the precious metals sector and other major equity indices.

Some commentators have suggested that the recent corrections indicate that the volatility has returned, but the WGC contends that there are "crucial differences" between now and the 1970s phases.

In a wide-ranging assessment, it lists more controlled inflation, well-spread mine supplies and the fact that it carries no credit risk as reason for the enduring safety of gold investment.

The WGC view has been supported recently by Afshin Nabavi, the head of trading at MKS Finance, who explained that the security of gold is a shining light in the current landscape of economic uncertainty.

He said recently: "What is left for people to put their money in? Despite the sharp move gold had on the downside (recently), compared to everything else - oil, platinum, other commodities - it actually held up well."

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