Current investing idea

Friends – here is one investing idea that make sense to me:

Gold ETF – Globally, the price of gold has gone up from USD 1200/Ounce to around USD 1500/Ounce since mid-May 2019 – this has happened because of US China trade war. This trade war is expected to go in till next US presidential election in Nov 2020.  In the coming months, China would try to defend itself from aggressive economic actions of US. There is a good chance the global currencies, lead by Chinese Yuan, would devalue against the US Dollar and the US interest rates would go down further. There will be a general fear of slowdown globally and this situation is ripe for investors to increase their allocation to gold globally. I believe that the Gold price would be going up in the months to come.

In India we have additional kicker as Rupee would further weaken against USD and all imports (including gold) would be costlier in Rupee terms.

I would recommend investing in Gold through the ETF route – SBI Gold ETF is quoting today (13th August 2019) at 3360.

This is a short-term idea – we can stay invested till the US- China trade war continues and once it is over, we can exit this investment.