Rarity does not mean premium pricing

OVER the past year and even year-to-date, one of the best-performing asset classes has been gold. Although the asset provides no tangible income in terms of yield, the price of gold futures’ continuous contract measured in US dollars is up 42.5% year-on-year and 28.2% year-to-date and was last seen at US$3,383 per ounce.

Even removing the weakness of the greenback, which is down by 8.8% since the start of the year, gold has appreciated by almost 20% this year.