How Can South African Investors Capitalise on Gold Price in 2021

How Can South African Investors Capitalise on Gold Price in 2021

Gold remains a fascinating and incredibly popular commodity and one that notoriously boasts significant value as a secure store of wealth during periods of economic uncertainty.

Unsurprisingly, South Africa remains one of the world’s most prolific explorers and manufacturers of gold, ranking 8th overall in the production of bullion.

But which African are nations the most prolific in this respect, and what are the best and quickest ways to invest in this precious commodity?

Where is Gold Production Most Prominent in Africa?

While regions such as Mali and Burkina Faso have become increasingly prolific explorers of gold of late, Ghana remains the current leader of this rush to market.

Ghana mined an impressive 142.4 metric tonnes of gold in 2019, with both traditional exploration companies and artisanal miners contributing to this haul.

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The minerals mined in Ghana comprise 37% of the country’s total exports, while gold accounts for 90% of the mineral exports mined within the nation’s boundaries. What’s more, the country boasts a currency gold reserve in excess of 1,000 metric tonnes.

Next on the list is South Africa, which mined 118.2 metric tonnes of gold in 2019. While this is an impressive number and enough for South Africa to rank second, however, it should be noted that gold production in the country actually fell from a peak of 137 metric tonnes during the previous year.

Sudan is ranked as the third biggest producer of gold in Africa, mining a total of 76.6 tonnes through 2019.

This north-east African economy also saw a pronounced decline from 93 tonnes in 2018 and 107 tonnes in 2017, but the national government recently suggested that all of these figures are actually inaccurate.

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More specifically, it claimed that annual gold production in Sudan has been between 120 and 200 tonnes during the last three years, so there’s a little confusion surrounding the figures here.

Sudan is also home to some of the biggest and most impressive gold mines in the world, so it’s definitely a key player in the African marketplace.

How to Invest Quickly and Effectively in Gold

In general terms, there are four general methods of investing in gold in the current marketplace.

These are described as direct ownership of gold bullion, indirect exposure through mining equities, collecting investment funds and gold derivatives.

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While the former affords investors a secure and tangible store of wealth that will appreciate in value during times of economic contraction, the other three options are a little more variable and may offer a little more flexibility to investors.

Certainly, derivatives on platforms like Tickmill enable investors to trade gold via CFDs or similar vehicles, including indices that feature gold (and mining) stocks on the NYSE, FTSE or JSE, with this enabling traders to speculate on price movement without assuming ownership of the underlying financial instruments.

This can also trigger easier and more pronounced profits, especially as a relatively liquid asset that often demonstrates a healthy balance between supply and demand.

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