Type of Gold To Buy & How To Trade Gold | Hong Kong
Buying and Trading Gold in Hong Kong
What is Gold Trading?
Gold Trading involves buying and holding gold bullion and spot gold, gold trading enables you to gain exposure to the market price without taking ownership of the physical metal.
Why is Gold Trading so popular?
• Gold is seen as a safe-haven asset, and it is used as a hedge against inflation, economic, and political uncertainty.
• Gold is a financial asset that helps diversify investors’ investment risks due to low correlation to equities and bonds.
• Central banks are aiming to diversify their foreign exchange reserves through gold in order to reduce their country’s dependence on the U.S. Dollar.
What moves gold prices?
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Inflation
When inflation rises, the value of currency decreases. Therefore, people tend to hold gold instead of money in order to hedge against inflationary conditions. This pushes gold prices higher during the inflationary period.
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Interest rate
Gold prices have an inverse relationship with the interest rate. When the interest rate drops, people tend to buy gold, leading to an increase in demand and price.
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Consumption Demand
The demand to buy gold in Hong Kong increases during festivals such as Chinese New Year and Diwali. As a result, gold prices normally reach the highest point between October and January.
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Geopolitical Factors
Political uncertainty has a negative impact on the prices of most asset classes. As a result, people tend to buy more gold in order to park funds.
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The U.S Dollar
Gold is traded in US Dollars. If the US Dollar falls in value, investors who use another currency to buy gold would benefit from the fluctuations.
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Government Reserves
Central Banks reserve gold with the purpose of diversifying their investment portfolio in order to cope with any type of financial crisis. Therefore, gold prices increase when Central Banks start holding more gold.
Types of Gold Investment
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Gold CFDs/London Gold
CFDs (Contract for difference) allow investors to speculate on the price movement of gold in either direction without actually owning any. Investors can either make a profit or loss according to investors’ forecasts.
Going Long: Investors make profit if the gold price increases. In other words, investors buy a Gold CFD and sell it at a later date when the gold price increases.
Going Short: Investors take advantage of markets where the gold price is falling. When investors are going short, they are selling a borrowed Gold CFD in the hope that its price will drop, and then buy it back later for profit.
How is CFD margin calculated?
Profit or loss = (Lot x Gold Volume) x (Exit Price – Entry Price)
Assumption: You buy a Gold CFD at a price of $25, and the Gold Volume is 5000 oz.
Example A: You sell the Gold CFD at a price of $26, and you will make a profit of $5000
(1 x 5000) x ($26 - $25) = +$5000
Example B: You sell the Gold CFD at a price of $24, and you will make a loss of $5000
(1 x $5000) x ($24 - $25) = = ($5,000)
The above examples are for reference only. Please note that you will also need to pay extra charges, such as commission fees, guaranteed stop fees, and overnight funding charges.
If you would like to know more regarding the full calculation of the profit or loss from Gold CFDs, please do not hesitate to contact our customer service hotline at 8206 2500.
How to choose your online trading platform?
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Segregated Trading Accounts
Segregated Trading Accounts help to ensure the security of traders’ funds. Investors’ funds will not be misappropriated for other purposes, such as bankruptcy, and will solely be used for their own trading and investment.
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Transparent Disclosure
Investors can minimize hidden costs if online trading platforms provide a high level of disclosure, including real-time prices and commission rates.
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Free Demo Account with risk-free
Free Demo Accounts enable investors to practice without risking real capital before moving to the live market. Furthermore, Free Demo Accounts also help investors understand how the platform and market works in order to let them gain confidence and develop their trading strategies.
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Ease of Deposits and Withdrawals
Many online trading platforms have their own withdrawal and funding processes and policies. Traders should consider online trading platforms that provide more than two methods of deposits and withdrawals, such as bank transfers, wire transfers and checks. In addition, traders should also consider the speed of withdrawals and deposits, which normally takes 1 – 7 working days to complete.
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Reliable Trading Platforms
Most trading transactions are completed online. Therefore, a stable, user-friendly, and well-designed trading platform is essential for investors to trade in their preferred area of interest. In addition, some trading platforms provide in-depth analysis tools and daily news to help investors achieve their trading goals.
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Quality of Client Support
Many online trading platforms offer 24/7 online support to their traders who need assistance at any time when encountering technical issues or have account funding inquiries.
3 Steps to start online gold trading with Emperor Financial Services Group (EFSG) in Hong Kong:
Step 1: Create an Account
Creating an account by providing your personal information. Please read our risk statement before proceeding doing this.
Step 2: Deposit
We offer multiple methods for you to deposit anytime, including eDDA, bank transfer, and cheque.
Step 3: Start Trading
Emperor Financial Services Group (EFSG) offers a variety of trading products, including Gold, Silver and Forex.
You may seek advice from our professional CS and sales team, who are licensed by Hong Kong financial institutions, through our official channels.
About Emperor Financial Services Group (EFSG)
Emperor Financial Services Group (EFSG) specializes in providing gold, silver, and forex trading services to customers in Hong Kong. Over the past four decades, EFSG has established a strong presence in Hong Kong and built a trustworthy reputation with its solid foundation, extensive network, and professional service teams. EFSG offers diversified trading platforms that include 24-hour online and smartphone trading. EFSG has several international entities and recognized licenses.
Emperor International Exchange (HK) Co. Ltd., is a recognized financial institution for leveraged foreign exchange trading with trading license no. ACJ 776. It provides leveraged foreign exchange trading services.
Emperor Bullion Limited ("EBL") provides comprehensive precious metals investment services.
Emperor Gold & Silver Company Limited ("EGSC"), a recognized electronic transaction member of the Chinese Gold & Silver Exchange Society ("CGSE") (CGSE No.: 102), holds a type AA license, while Emperor International Bullion Limited is a gold group member of CGSE (member: 240).
Risk Statement
Please note that all content is for reference only and not be interpreted as any trading advice. Emperor Bullion Limited is not responsible for the profit or loss of direct or indirect investment in the above information. Trading Over the Counter (OTC) Gold/Silver Bullion on margin carries a high level of risk and may not be suitable for all investors. Before deciding to trade OTC Gold/Silver Bullion offered by Emperor Bullion Limited, you should carefully consider your objectives, financial situation, needs, and level of experience. The possibility exists that you could sustain losses in excess of your deposited funds and therefore, you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with trading on margin. Emperor Bullion Limited recommends you seek advice from a separate financial advisor.
OTC Gold/Silver Bullion trading carries a high degree of risk and may not be suitable for all investors. The high degree of leverage can work against you, as well as for you. OTC Gold/Silver Bullion is not regulated by the Securities and Futures Commission (""SFC"") and therefore trading OTC Gold/Silver Bullion will not be subject to rules or regulations promulgated by the SFC. Before deciding to trade OTC Gold/Silver Bullion you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain losses in excess of your deposited fund or even more in extreme circumstances and therefore, you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading OTC Gold/Silver Bullion and seek advice from an independent financial advisor if you require additional information.
Please note that commensurate with the opening/closing of the market for the underlying instrument, traders may experience gaps in market prices. Due to the volatility expressed during these time periods, trading at the open or at the close, can involve additional risk and must be factored into any trading decision. These time periods are specifically mentioned because they are associated with the lowest levels of market liquidity and can be followed by significant movements in prices for both OTC Gold/Silver Bullion.
OTC Gold/Silver Bullion trading allows you to potentially profit or sustain a loss from the fluctuations in the price of the underlying instrument. The price of OTC Gold/Silver Bullion is based on the price of the underlying instrument and is not traded on an exchange, despite the status, or location of the underlying instrument. Therefore, it is an over the counter (OTC) product, and you are trading with Emperor Bullion Limited as the counterparty to all transactions you undertake.
