UK-based multi-family office Stonehage Group
has warned investors in gold suggesting they take a neutral stance
in investing in the overvalued metal.
Stonehage said that investors were paying
exceedingly high prices to protect themselves against inflation and
the Eurozone crisis by investing in gold.
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Stonehage said that the price of gold being
dependent on investment demand puts it in a precarious
position.
Ronnie Armist, executive director at
Stonehage, said: “Should investors fall out of love with it, the
growing stockpiles of gold held in vaults and ETFs may hit the
market, placing downward pressure on prices.”
He said that investors should not rely on gold
when markets are unstable.
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By GlobalDataPrice of gold may be hit
The group’s investment advisory division,
Stonehage Investment Partners (SIP), said that if inflation does
not surface soon, gold prices will be considerably affected.
Stonehage also warned that if investors
continue to buy substantial amounts of gold, the price of the metal
could triple. The group said this could happen if all global
investors increase gold allocations by just 1%.
