Profit of nearly 5 million VND/tael after half a month
In the past half month, the domestic gold market has been “stormy” as the price of SJC gold has been increasing non-stop. By noon on December 26, this precious metal had jumped to an unimaginable high of VND80.20 million/tael for selling and VND79.20 million/tael for buying, an increase of VND1.9 million/tael for buying and VND1.7 million/tael for selling.
Compared to December 15, the price of SJC gold has increased by VND5.8 million/tael, equivalent to 7.8%. Minus the VND1 million/tael difference between the buying and selling prices, after only half a month, investors have made a profit of VND4.8 million/tael, equivalent to 6.5%. This is a very high rate of return.
Although the price of gold has increased sharply, to an unimaginable level, investors still do not rush to trade like before. Bao Tin Minh Chau Company said that on the morning of December 26, at Bao Tin Minh Chau's business establishments, the number of buyers accounted for 55%, the number of sellers was only 45%. This ratio has remained unchanged for a long time at this "gold house".
Gold prices have increased by nearly 6 million VND/tael after only half a month, bringing a profit of nearly 5 million VND/tael to buyers. Photo: Hoang Tu
Meanwhile, the “seller” is also in no hurry. Mr. Thanh Tung (Hai Ba Trung, Hanoi ), who bought gold in June 2023, said that he definitely will not buy at this time. As for whether to sell or not, he will consider it further.
“During the same period, I bought both gold and stocks. Currently, my stocks are almost flat. Minus transaction fees, the loss is insignificant, but gold is generating good profits. However, I consider gold a safe haven, so I have no intention of selling unless there is an emergency. If the gold price continues to rise, I will be happy with the big profit. If the price drops, it is not a problem because I have the view that I will save about 5% of my total assets in gold and hold it for the long term,” Mr. Tung shared his investment views.
Don't buy gold
Talking to reporters of the Journalists and Public Opinion newspaper about the crazy increase in domestic gold prices, Dr. Nguyen Minh Phong, former Head of the Economic Research Department, Hanoi Institute for Socio-Economic Development Studies, said that the sharp increase in gold prices during this time was mainly due to psychology.
“There are three factors that confirm that the market is being driven by psychology. That is the difference between domestic gold prices and world gold prices, the difference between buying and selling prices of SJC gold is too high, and the gold price has increased too strongly in one day. Currently, the market has all three of these factors,” commented Dr. Nguyen Minh Phong.
Besides market psychology, the gap between supply and demand is also one of the main reasons for the feverish gold market. Currently, demand is not exceptionally high but supply is less because the State does not allow the stamping of more SJC gold.
When asked whether or not to buy gold at this time, Dr. Nguyen Minh Phong affirmed that it is not advisable because: “The gold price is too high, it cannot stay high forever. Currently, the price of SJC gold is about 17 million VND/tael more expensive than the world price. This is a big risk. Of course, those who are interested in speculation will buy. However, they will face the risk of falling prices.”
Responding to reporters from the Journalists and Public Opinion newspaper, Dr. Nguyen Tri Hieu, a banking and finance expert, said that the difference between the world gold price and the domestic price is only a maximum of VND5 million/tael, and the difference between the buying and selling price is only VND500,000/tael. If the difference is higher than these figures, the risk for investors is very high.
SJC gold price increased sharply due to low supply. Illustrative photo
Sharing the same opinion with Mr. Hieu, Mr. Phong added that the domestic gold price should not differ too much from the world price. This is the result of the administrative mechanism through the impact of Decree 24.
Decree 24 is considered to have made an important contribution to limiting the gold-ization situation. However, at the question-and-answer session of the National Assembly on June 8 and 9, many delegates questioned State Bank Governor Nguyen Thi Hong about the situation of gold prices increasing too high and the large gap between domestic and world gold prices.
Governor Nguyen Thi Hong said: "In the process of summarizing and evaluating Decree 24 in the coming time, we will also study, listen to the opinions of the delegates and will also ask for widespread opinions to see how we choose, many other brands to jointly produce gold bars or a brand of the State Bank, then we will also evaluate, analyze the impact and ask for opinions, certainly will ask for opinions of the National Assembly delegates."
In its role as a state manager, the Governor of the State Bank said it would be ready to regulate gold prices if necessary. However, according to updated data, people do not have much demand to buy gold bars. Therefore, the bank has not intervened, only in case of necessity will it import gold to intervene.
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