Gold trading operates on a global, continuous basis, with active markets open at all times across key financial centers such as London, New York, Zurich, Shanghai, and Hong Kong. These hubs facilitate seamless trading and enable a near-constant process of price discovery, where market forces from different regions help determine the value of gold.
But unlike most commodities, gold’s price is not dictated exclusively by industrial or practical consumption. Instead, gold derives its value from a trio of demand sources, investors seeking a hedge against economic instability, jewelry manufacturers catering to global tastes and traditions, and technological industries utilizing gold for its unique physical properties.
These combined drivers set gold as both a financial asset and a tangible good.
This multifaceted demand for gold supports price resilience, even when one sector weakens. This multifaceted demand also helps to explain why gold often maintains value or even appreciates when industrial-only commodities face downturns.
*source: Investing Intelligently in Gold
