“Tamensi movetur!” – “And yet it moves” – These words of Galileo Galilei in the mouth, as the Inquisition court to leave. Whether truth or legend, a significant rate, it is all. And he is also on the Gold applicable. Many investors believe that Gold would almost have no variations, but it is also a legend.
In the financial science is used to measure the degree of change of an investment instrument (i.e., consequently, the fluctuation intensitiät to its mean value) in its volatility.
“The volatility of an investment object is thus a multi-dimensional, symmetric measure of the Riskiness of an investment“
(cf. Financial Engineering, Bloss, Ernst, Häcker, Sörensen).
This is high, so a high variation in intensity, and derived a higher risk can be posituliert,. Therefore, the Principle is that Gold must have a small variation, since it is often adopted as a safe Investment, right.
In the figure I (source: Bloomberg) you can see the fluctuation in intensity of Gold. We can here detect a variation in the Sigma band.
If one compares these volatility fluctuations, with the development of the gold price (see figure II source: Bloomberg) so you can draw conclusions on the price development and the market environment.
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Michael Bloss, Andreas Franik in the BSTV Interview:
Sources: article image: DBAG; EIFD; ; information illustrations: Bloomberg; Interview: BSTV