What UBS’ Cashin and Schwab’s Frederick say about market sell-off Description video: Randy Frederick of Charles Schwab and Art Cashin of UBS Financial Services join CNBC’s \”Closing Bell\” to discuss the day’s market sell-off. UBS recommends buying gold immediately Investors […]
What UBS’ Cashin and Schwab’s Frederick say about market sell-off
Randy Frederick of Charles Schwab and Art Cashin of UBS Financial Services join CNBC’s \”Closing Bell\” to discuss the day’s market sell-off.
UBS recommends buying gold immediately
Investors should invest their money in gold now, as it represents a “very good hedge” before risky events such as the US election. UBS Global Wealth Management reported this to CNBC.
«We love gold because we think that by the end of the year gold is likely to hit around $ 2K an ounce.», – said on Tuesday the company’s regional investment director Calvin Tay.
«And gold has protective properties, Tay said on CNBC. – In case of uncertainty about the US elections and the Covid-19 pandemic, gold is a very, very good insurance. And its recent weakness provides an excellent starting point for investors.».
The price of gold this year has reached record highs – and for the first time in history, exceeded $ 2,000 per ounce. Recently, however, prices have dropped again and last traded around $ 1880 an ounce on Tuesday..
The precious metal is also attractive due to low interest rates, Tay noted..
If interest rates remain low, as the Fed promises, the opportunity cost of owning gold – a non-profitable asset – will be «quite low», he added. This is because investors do not give up interest that would otherwise have been received from earning assets..
Tay also recommended that investors put some money in Chinese government bonds as they should be included in the FTSE Russell World Government Bond Index.&# 39; s World Government Bond Index. Inclusion from October 2021 should bring billions of dollars to China.
Tay noted that Chinese government bond yields are 2.5% higher than in other regions, compared to US yields at 0.6% and European bond yields at significant negative levels..
«These are really high returns for high quality government with very strong balance sheets», – he said.