PROPOSAL

Investment in Gold

[Name of the Institute]

CHAPTER 1: INTRODUCTION3

1.1 Background of the Study4

1.2 Research aim and objectives4

CHAPTER 2: LITERATURE REVIEW5

2.1 Why to Invest in Gold?10

2.2 Where gold are traded?11

2.3 How to trade gold?11

2.4 Trading in Gold13

2.4.1 Gold Coins Investment13

2.4.2 Certificates of Deposit13

2.4.3 Futures on gold14

2.4.4 Mutual Funds14

2.4.5 ETF's14

2.5 Major players15

2.6 Factors affecting the turbulence of gold's price16

2.6.1 An overview of what affects the gold's price17

2.6.2 Contemporary Consumer as an Actor on the Marketplace19

CHAPTER 3: RESEARCH METHODOLOGY21

3.1 Expected Result21

REFERENCES22

Investment in Gold

CHAPTER 1: INTRODUCTION

Gold has a timeless appeal, especially for those who are concerned about the volatility of the stock market, inflation, devaluation of the currency or the collapse of civilization. However, not everyone believes that gold is the safe haven that its advocates proclaim. After follow an upward trend in the last twelve years, has fallen sharply in 2013.

The reason for these ups and downs is always debated. When the price of steel rises or falls, the reason is usually in the pace of global economic growth. The grain prices are strongly influenced by climatic conditions. But gold is moved by emotion. Most of the gold is just using in the production of jewelry. The largest consumers are the buyers of Indian jewelery, notes Franklin Allen, Wharton finance professor. Gold prices are also affected by fluctuations in demand for other investments. When actions seem a good choice, some investors are changed by gold. The consequent fall in demand favors lower price. The devaluation of gold this year coincided with the rapid rise in stock prices (Miller, 1985b, pp. 1009)..

Siegel manages a graph indicates the real earnings of various asset classes over several years, with inflation-adjusted returns. Because of inflation, a dollar bought in 1802 would be worth only 5.2 cents in late 2011. A dollar invested in Treasury securities at the same time would be worth U.S. $ 282 or U.S. $ 1,632 if it were invested in long-term bonds. If you have been investing in gold, today would be worth $ 4.50. It is true that it is a profit taking into account inflation. But the same dollar invested in a bag of actions reflecting the general market situation today would be worth an extraordinary amount of U.S. $ 706,199.

1.1 Background of the Study

As an investment, gold has some disadvantages. Whoever possesses a significant amount of metal must invest in protecting, representing a cost that affects your return, says Siegel. Unlike savings in a bank, securities or stocks that pay dividends, gold does not generate income. "It's a very volatile asset with zero income," says Allen.

Gold does not give right to share in the profits of an enterprise, a benefit enjoyed only shareholder. Investors who want safety can turn to government bonds, knowing that the state can use its fiscal agent privilege to pay the owners of its securities. The price of gold does not have any support (Hotelling, 1931, pp. 31).

In a period of hyperinflation, when the currency loses its value virtually, or in times of great distrust in the economy ...