SHAH ALAM, June 19 — To reduce risk, diversify your investment tools and don’t put all your money into just one asset like gold, said Bank Muamalat Malaysia Bhd economist Mohd Afzanizam Abdul Rashid.
He said portfolio diversification is important to ensure losses in one instrument can be balanced with profit from another instrument, which could lower risk especially when markets grapple with economic uncertainties and asset price fluctuations.
“Gold is an attractive investment instrument, it has good prospects, but it is best for an investor not to put all their investments in gold.
“They could invest in unit trusts … that invest in equity, stock market, bond market, currency market, and property.
“It depends on individual risk appetite, but investments should be diversified so they are not subject to or dependent on just one portfolio,” he told Media Selangor.
Afzanizam explained that gold prices that previously soared would usually undergo corrections due to profit-taking by investors, which is normal in currency markets, and advised investors to look at gold as a medium- to long-term strategy.
“If you buy at a high price, don’t expect immediate (profits). Keep it for a longer time because usually the price will go down and back up,” he added.
Previously, the Universiti Teknologi MARA (UiTM) Economy and Financial Studies Department senior lecturer said gold is a resilient long-term investment instrument, even though the precious metal’s values have been fluctuating recently due to various economic factors and geopolitical issues.
Afzanizam said gold prices now are influenced by global interest policies, especially the United States’ monetary decisions, the US dollar’s strength, geopolitical conflicts, and continuous demand from central banks.
