Interest in gold, silver and other precious metals has soared during the financial crisis – and with it their prices. The boom has been great for derivatives exchanges – many have enjoyed growing volumes and a rash of new contracts has been launched. But is this just a speculative craze that will vanish as quickly as it came? Or is it the start of something bigger? Owen Sanderson reports.
Nobody who has been watching the commodities markets can fail to be impressed by the rise and rise of the precious metals.
Gold bulls are fond of quoting the statistic that their metal has been the best-performing asset over the last 10 years. The performance of the other precious metals has been similar, despite their greater range of useful applications, and hence keener vulnerability to fluctuations in industrial activity.
With rising prices have come more volatility and higher trading volumes –...