Every time you buy, you lose.

The profitability of the domestic market is increasingly “gloomy”. Investors are too familiar with the scene of losses even when the price of gold increases.

This week, after many ups and downs, the SJC gold price closed at nearly 67.30 million VND/tael for sale, up about 100,000 VND/tael, equivalent to 0.15% compared to the previous week. However, gold buyers still lost 600,000 VND/tael. The reason is that the difference between the buying price and the selling price is still very high.

gold investors buy in fear picture 1 — In recent weeks, gold investors have been losing money every time they buy even though the price of gold has increased. Illustrative photo

Specifically, at the close of this week, the price of SJC gold at Bao Tin Minh Chau Jewelry Company stopped at: 66.70 million VND/tael - 67.28 million VND/tael. SJC gold buyers at Bao Tin Minh Chau suffered a slight loss after 1 week.

At the end of the week, SJC gold prices at Saigon Jewelry Company – SJC, Phu Nhuan Jewelry Company and Doji Group were listed at: VND 66.60 million/tael – VND 67.30 million/tael; VND 66.70 million/tael – VND 67.25 million/tael and VND 66.55 million/tael – VND 67.30 million/tael.

The difference between the buying and selling price of SJC gold at Doji Group is the highest, reaching 800,000 VND/tael. That means after investors buy, the gold price must increase by 800,000 VND/tael for investors to break even.

The same situation also happened with non-SJC gold, although this precious metal had a stronger growth rate.

At Bao Tin Minh Chau, the price of Thang Long dragon gold closed the week at: 56.38 million VND/tael - 57.23 million VND/tael, an increase of 350,000 VND/tael (equivalent to 0.62%) in both buying and selling directions.

Thus, the price of non-SJC gold increased 4.1 times faster than the price of SJC gold, but buyers still suffered a slight loss after 1 week.

Specifically, if bought at the end of last week, by the end of the week if sold, investors would have lost 500,000 VND/tael due to the huge difference between the buying and selling price of non-SJC gold, reaching 850,000 VND/tael.

Because the profitability of gold is less attractive, Vietnamese people are less interested in gold.

According to a report by the World Gold Council (WGC), Vietnam's gold demand in the second quarter of 2023 reached only 12.7 tons, down 9% compared to the same period in 2022. Demand for gold bars and gold coins decreased by 5%. The same thing happened to gold jewelry when demand decreased from 4.5 tons in the second quarter of 2022 to 3.7 tons in the previous quarter, equivalent to a decrease of 18%.

Previously, gold consumption in the first quarter also decreased by 12% compared to the same period in 2022. With two consecutive quarters of decline, total gold consumption by Vietnamese people in the first half of the year was only 22.9 tons, down nearly 32% compared to the same period last year (33.6 tons). Compared to the year before the pandemic (2019), purchasing power also decreased by nearly 29%.

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