Gold and silver have been used since the ancient times. They were used for making jewellery and medicines. In fact, both these items have a big history of trading. With time, many things changed, the form of trading changed but the commodities remained almost the same. Gold and silver are still among the most popular metals that have got wide application in our daily lives. However, the scenario has become different for the past few months.
The Covid-19 pandemic has led the world towards an economic recession which means securities are riskier. This is an unfortunate time where we need to take each step with utmost precision. It is applicable to both our personal as well as professional lives. Nobody actually wants to invite risks in any manner. The same goes with online commodities trading Dubai. Traders have started looking for commodities that are safer as compared to others such as gold.
Gold seems to be an ideal option for investment considering the current scenario. The metal is known to appreciate in the times of recession. This is the reason behind the constantly increasing craze for gold among the investors. You can seek assistance from commodities trading brokers in UAE and invest in gold if you are looking for a safe option.
In order to get more clarity, we have to understand the current economic situation. On March 11 2020, Covid-19 was declared a pandemic by the WHO. This announcement made many countries lock their citizens in their homes immediately. All the major economic hubs were put under a strict lockdown. As a result, the economy underwent an unexpected recession. The pandemic has badly shaken even the most developed countries, and it is going to take a long period to come out of this recession. There are many free online trading sites in UAE where you will get to read more about it.
Under these circumstances, gold is the only metal that looks promising. It does well even during the recession and is a hot option for online commodities trading Dubai these days. If you are looking forward to making profits through free online trade UAE, you should prefer gold as a commodity.
Unlike gold, silver depends more on economic activity. The metal behaves in the same manner as securities do. If the economy is in a good situation, the metal will perform better; if it is not, it won’t offer good returns. The reason behind this behaviour is its demand in industries. The metal is used in many industries and appreciates when the economy is booming.
A booming economy asks for more liquidity which gives rise to the demand for silver coins. Also, the metal is used as a raw material in many industries which makes a direct impact on its demand and performance. Considering the current scenario, it won’t be a wise decision to invest in silver as the economy is not doing that good. There are many free online trading sites in UAE that can help you with more information on this.
The Bottom Line
During the times of economic recession, it is wise to play safe. Gold is the metal which remains in demand in these times because of its intrinsic value. It does not face depreciation at all. There are many reasons behind this. Investors don’t prefer buying stocks from companies these days as many firms have witnessed operational disruptions which has led them to making less profits. On the contrary, gold is being viewed as a less risky asset and getting all the attention.
If we talk about silver, it behaves pathetic during an economic crisis. Also, it is more volatile as compared to gold. Therefore, it can be concluded that it is not a good option at all. You can do more research on this and reach a decision on your own.