Private investor sentiment towards physical gold held firm in November, extending its strongest run for seven years as precious-metal prices retreated further from this summer’s multi-year highs, says BullionVault which claims to be the world’s largest physical gold and silver online market.
In its latest update, having risen for four months in a row – something not seen since the end of 2012 – the Gold Investor Index was unchanged last month from October’s level of 56.2, its highest reading since July 2018.
The index tracks the number of people starting or adding to their gold holdings across the month versus those choosing to sell the metal.
Peaking at 71.7 in September 2011, the Gold Investor Index fell this June to 49.1, its lowest reading in almost a decade and only the second time it signalled more sellers than buyers, slipping below 50 as prices jumped and profit-taking outweighed new buying almost 2-to-1.
Gold prices retreated in November at their fastest monthly pace since August 2018, dropping 1.7% to average $1470 per ounce, the cheapest since July this year.
That still put 2019’s average gold price 17.8% higher for the year so far, the strongest rise since 2011.
Wall Street’s S&P500 set 11 fresh all-time record highs in 20 sessions last month, while the MSCI World Index of developed-market equities came within 0.4% of start-2018’s all-time peak.
Adrian Ash, director of research at BullionVault said: “Despite easing back this autumn, gold has defied surging stock markets and a strong US Dollar in 2019 to record its best year since 2011 so far.
“Gold’s investment appeal has shone this year as a hedge against plunging bond yields, negative interest rates, and a growing sense that equity valuations are too stretched to be sustainable. Geopolitical risk also continues to see private investors add to their gold holdings as we approach New Year 2020.”