Mumbai: Gold price has gained 16.14 per cent in the quarter ended on March 31, the best quarter on record since September 1986. “Though there was always the risk of reduced flows to gold if there is improvement in the risk sentiment, given the global macro, downsides in gold would be limited and likely to attract significant buying on any meaningful pullbacks,” said Chirag Mehta, senior fund manager, alternative investments, Quantum and Quantum Multi-Asset Fund & Quantum Equity Fund of Funds.
Fundamentally, gold seems to be on a solid footing as central bankers have again hit the wall. “Gold should benefit as central bankers attempt further measures through more newer, unconventional and untested approaches to revive growth,” he said.
However he feels that gold will be a useful portfolio diversification tool in the present macroeconomic picture, and thereby help the investor to reduce the overall portfolio risk.
Gold had a spectacular run for much of this year; and a correction and consolidation after sharp moves are signs of a healthy market, he said.
Though gold ended almost flat for the month of March, it has been correcting from the highs of $1,285 seen during the month. Gold climbed to a 52-week high on weak US economic data and worries over Chinese economy....