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GOLD RATE

FLUCTUATIONS

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PROFIT = 12 TIMES

28/08/2011 2PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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PROFIT = 7 TIMES

28/08/2011 3PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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PROFIT = 4 TIMES

28/08/2011 4PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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PROFIT = 1.5 TIMES

28/08/2011 5PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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PROFIT = 1.3 TIMES

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REASONS FORTHE PRICE RISE

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REASONS FOR THE PRICE RISE

Dollar crisis: A weak dollar in the wake of the

recession has forced people to invest in gold

which in the long run would fetch more

returns. Dollar is likely to weaken further leading

to a further rise in gold prices.

Low saving rate: With banks offering lower

interest rates, fixed deposits make little sense. It

is cheaper to even borrow money to invest in

gold.28/08/2011 8PS NITHYA, Assitant Professor, RVS College

of Engineering and Technology, Coimbatore

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REASONS FOR THE PRICE RISE

Inflation: Gold has always been a good tool to

fight inflation. Rising inflation rate appreciates

gold prices. With inflation rising to record

highs, gold will prove to be a safe bet.

28/08/2011 9PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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REASONS FOR THE PRICE RISE

Economic crisis: Gold has always given high

returns over a long term. As the crisis

triggered a fall in markets across the globe,

many investors wary of investing in stocks or

bonds, found refuge in gold. Gold is globally

accepted and easily convertible into cash.

28/08/2011 10PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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REASONS FOR THE PRICE RISE

A fall in gold supply: Gold mining is decreasing

and the demand for gold is increasing. Gold

supply has decreased by almost 40 per cent as

the cost of mining, legal formalities and

geographical problems have increased which has

led to a fall in gold mining.

28/08/2011 11PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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REASONS FOR THE PRICE RISE

US interest rates: The interest rates affect gold

prices. Whenever interest rates fall, gold

prices rise. Lowering interest rates increases

gold prices as gold becomes a better

investment option.

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REASONS FOR THE PRICE RISE

Political concerns, crisis: Whenever there is a

crisis, war, terrorist attack etc, investors rush

to prevent erosion of their investments and

gold as a safe haven. After 9/11 terror attacks

in the United States, the demand for gold had

gone up.

28/08/2011 13PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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REASONS FOR THE PRICE RISE

Festivals: Indians are among the largest

consumers of gold. Gold has been used as

ornaments and gifted during festivals and

weddings. So there is a huge demand for gold

during the festive season.

28/08/2011 14PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore

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To conclude.

Dollar crisis

Low saving rate

Inflation

Economic crisis

A fall in gold supply

US interest rates

Political concerns, crisis

Festivals

28/08/2011 15PS NITHYA, Assitant Professor, RVS Collegeof Engineering and Technology, Coimbatore