As some countries globally are in the 2nd lockdown phase or contemplating another lockdown due to the Covid-19 pandemic, gold investors that traditionally used to buy from retailers, will not get access to the physical but would have to rely on alternative channels for their purchases.
If this fact was not apparent during the 1st lockdown period, it definitely does apply now. Actually we should take this as a learning opportunity and explore how to harness the immense power of technology and digitalisation.
On further reflecting, it does sound very appealing and the future is looking bright for the investors.
Recently, Chirag Sharma, Senior Director at AGA Bullion featured as a panelist at the IBMC UAE's Global Gold Convention 2020 and discussed future trends of the global bullion industry.
In his deliberations, he highlighted the need for digitalization of gold for investors and businesses to mutually benefit.
Today, most investors do not understand complex derivative instruments or they don't have access to them due to heavy financial considerations imposed by electronic exchanges and similarly they may not qualify to secure a sourcing opportunity from their financial services provider for purchasing the yellow metal, as this service is provided privileged bank account holders.
These investors need access to a very simple online gold trading platform, where from the click of a button they can sell or buy and store at the best available international price, not local prevailing prices. The platform gets a real time USD/Oz price from various multi-national bullion banks and selects the best spot price for displaying to the customer.
The beauty of the platform is that you can buy or sell unallocated gold in denominations as low as 1gram and in its increments. Once the account
balance reaches a redeemable quantity such as 100gram, 1kg, etc as provided by the platform, the investor has the right to convert the purchased quantity into a physically allocated gold bar. Also you can always sell your gold purchases without the need for converting it into a physical gold bar, so it provides a lot of flexibility. You also can store your physical at a minimal economic cost at the platform's secure logistics vaulting provider or have the physical delivered to you at your door step.
Apart from the trading flexibility, it also provides huge savings as the investor does not need to incur costs of system integration into the
platform, it is as easy as plug and play. Additionally since the transaction is an outright purchase there is no need to get exposed to marked to market gold price fluctuations and associated margin calls, so your funds are not blocked at any time by the platform.
The ease of access to physical gold and flexible trading options at the click of a button justifies that the future of gold is digital.
Possibly this is one of the positive impacts the Covid-19 era. Let's welcome and embrace DIGITALIZATION!
