We may receive commissions from some links to products on this page. Promotions are subject to availability and retailer terms.
The rising price of an investment is usually a good indicator of that asset's success. And, in recent years, gold has seen significant growth, breaking multiple price records over the last 18 months. That's largely due to the precious metal's ability to hedge against the effects of inflation while also diversifying portfoliosthat are perhaps otherwise too heavily invested in stocks and bonds.
However, while the price of the metal has surged this year, it's down significantly from its record high on May 20, providing an opportunity for those not yet invested in the yellow metal to get started now. For these beginning gold investors, it helps to get a better idea of how the price of the metal has changed over the past few weeks to better time a prospective move. Below, we'll detail exactly how much the price of gold has changed, in dollars and cents — and explain why now may still be a good time to get invested in the metal.
Start by exploring your top gold investing options online here.
How much the price of gold has dropped since May
The price of gold has risen dramatically since January 1, when it was selling for $2,063.73 per ounce. It hit $2,439.98 per ounce on May 20 – a $376.25 jump or just over 18%. Since then, however, the price has fallen. As of June 25, 2024, gold is now priced at $2,236.43 per ounce. That's an 8% drop in just over one month.
While still significantly above where it started the year, a cooling inflation rate and hints of interest rate cuts to come may have caused some investors to turn away from the safe haven that gold typically represents. But a reduction in competition, and a slightly lower price entry point, could be the exact combination that prospective investors require to get invested now.
See what price you could secure your gold investment with here.
Why you should still invest in gold
For starters, inflation is cyclical. And though it appears that the economy is finally at the end of this particular cycle, it doesn't mean that it won't return, perhaps sooner than many economists would prefer. So while it makes sense to add gold to your portfolio to protect against the worst effects of inflation (gold tends to maintain its value and even rise during such periods), it's arguably even more advantageous to preemptively fight against the repercussions of the next round of inflation.
And at a lower price point than what's been available, now is a smart time to do so. Not only will gold help with inflation and portfolio diversification, but by acting now, before any major price rises, investors may also be setting themselves up to turn a quick profit, should the price rise as high as some experts predict. With some experts predicting a price of $3,000 or more per ounce, by getting into gold now investors can potentially earn even more money than they would have if they started in January and sold in May.
The bottom line
A drop in the price of gold, even if it's from a recent record high, offers prospective investors a unique opportunity to capitalize on the yellow metal. Not only will they add a protection mechanism against inflation to their portfolio, but they'll also help diversify their investments and potentially even make a quick profit if the price soon surges again. Just be sure to cap any gold investment at 10% of your portfolio to also benefit from other, more volatile asset classes as well.
Matt Richardson is the managing editor for the Managing Your Money section for CBSNews.com. He writes and edits content about personal finance ranging from savings to investing to insurance.
