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Private gold investors build “crisis insurance” for 2013

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Self-directed gold investors used last week’s drop in the gold price to add to their holdings, according to the latest Gold Investor Index from online precious metals exchange BullionVault.

Based on actual transaction data from the bullion provider to private investors – now used by 43,000 people worldwide – the Gold Investor Index shows whether more people are buying or selling gold, or choosing to sit tight.
 
BullionVault’s index rose for the fourth month running in November, reaching a six-month high of 56.5 from the previous month’s level of 56.0.
 
A reading of 50 would indicate a perfect balance of buyers and sellers. November’s reading would have been lower than October’s (although still above 50) had it not been for gold’s drop last week, when customers took advantage of lower prices.
 
Last Wednesday’s sudden two per cent fall saw more than three times as many BullionVault users buy gold as compared with the previous working-week’s daily average.

"I think 2013 will be a bad year in all markets," said one BullionVault user, responding to a survey conducted late last week, "but it can offer some buying opportunities in gold for the long term."
 
"Gold is monetary collapse insurance," said another.
 
"I fear for the millions of retirees and superannuants who risk losing their accumulated wealth," said a third.
 
"We are still not over the worse," agreed another BullionVault user, "and the global wallpapering over what are incredibly large economic cracks is extremely worrying."
 
More positively, "I always look forward with hope," said one, "because private investors now have options," while another advised "Work for the best, plan for the worst."
 
One retiree however said that "[Things are] going to get worse because it is impossible for all the circumstances that affect us to get better. We are on a fixed income pension, but we have a strategy in place."
 
"Expect mediocrity and stagnation – Japan-style – not disaster," said another investor who uses the precious metals exchange.
 
In November on BullionVault users added 559 kilos of gold to their holdings (17,790 troy ounces), the second month running of half-a-tonne additions.

Total user gold holdings rose to 31.9 tonnes (1.03 million ounces), a new record and 17.2 per cent greater from a year earlier.

BullionVault saw a new record order via its iPhone app, with one customer trading 10 kilos of gold (321 ounces) for a value of USD550,000.
 
Adrian Ash, head of research, says: “2012 has been the first year in six without a focused moment of crisis for Western investors and savers. That has clearly kept a lid on new gold investment demand.
 
"But the background noise of unpayable debts and zero interest rates has only grown louder. People buying physical gold with a chunk of their savings clearly think the financial risks of 2013 need insuring against."

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