Gold Stocks

Gold Stocks

Gold Penny stocks to watch. Gold has become one of the best investments you can make today. Historically, investors have always turned to gold in a time of economic crisis. When the value of the dollar is plunging, the investment community rushes into gold as a way to protect their assets.

This current economic crisis isn’t just affecting us here in America, it’s affecting the entire world and investors everywhere are turning to gold as a safe haven. I think we all know that this global rescission is not going to magically disappear overnight which would also mean that the rise of gold prices won’t be slowing down just yet.

Last year alone world investment in gold nearly doubled, exceeding 1,900 tonnes-a value of around billion. Yet the government, central banks, and private investors are not the biggest driving force of Gold’s dramatic price increase. The highest demand for gold comes from the jewelry industry and America is not the country with the highest demand, India is.

A quick history lesson; gold import in India went thru strong restrictions during the two world wars and adopted a fully restricted policy after independence. They didn’t have a reformed policy until the early 1990′s. An interesting fact about the gold control regime was that it prohibited all gold transactions between residents and non-residents. This caused an effect similar to America’s prohibition of black market smuggling and unofficial transactions in foreign exchange began to flourish. India’s gold consumptions accelerated sharply during the 1990′s after the liberalization of the gold import policy.

Today India is the world’s largest consumers of gold. In the first quarter of this year, total consumer demand in India soared 698% to 193.5 tonnes. The jewelry industry there contributes over 15% of the country’s total exports and provides employment to 1.3 million people directly and indirectly.

Penny stocks are a great way to get into gold investing. One of the more profitable investment choices is gold stocks. Investors can buy shares in junior gold companies relatively cheap and see staggering gains once the gold starts coming out of the ground.

A junior mining company is an exploration company that looks for new deposits of gold, silver, uranium or other precious minerals. These companies target properties that are believed to have significant potential for finding large mineral deposits.

The junior gold mining companies often see the greatest impact on their share prices, so much so that you don’t have to wait to invest until the gold is being produced. When a junior gold company is in the exploration phase and strikes gold, the share price soars.