Investors continue their gold buying sprees to maximize their gains as COVID-19 tanks almost all other markets. In the last three months alone, gold-backed ETFs saw a growth of a record-breaking $23 billion across all regions, according to the World Gold Council.

The most popular gold holdings include SPDR Gold Trust and SPDR S&P 500. The outlook for gold is looking even more promising because many experts believe that the US economy will be tested in the coming months to come.

The investments were used to add 298 metric tons of the yellow metal to gold ETF holdings. Much of safe-haven buying has been driven by fears over a second wave of coronavirus infections, defying the trend of traditional stock markets which have tanked in recent weeks. As a comparison, SPDR Gold Shares went up by 8.6%, but the S&P 500 index slumped by 17.7% in the same time frame.

Experts believe that the prices for gold will go even higher. Another factor that has led to the surge in gold is the difficulty in fabricating it since factories are closed down due to the pandemic. This has sent the prices for coins much faster than the ones quoted in the market, forcing small investors to pay extra ‘premiums’.

Precious metals such as gold are considered by experts as an excellent way to diversify a portfolio of any size. The value of gold tends to surge and other investments fall. So far this year, this is exactly what has happened and stocks have crashed while prices for the yellow metal are reaching record-highs. 

There are also speculations of increased government spending which will lead to the devaluation of the dollar, in turn, providing a boost to the demand for gold. At the time of writing, gold prices have pulled past $1700 an ounce and are on their way to reach $2000.

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