ALL that glisters is not a golden investment, according to investment experts.
Recent claims that gold - the traditional staple for many Hong Kong portfolios - is set to make a comeback have met with a cool response.
William Tatham, a divisional director of independent financial advisers' Towry Law International, said: ''Gold has been a little disappointing since it came back from the peak of more than US$400 per ounce last year.
''It is important to remember that it is both an investment and a commodity, which means there are different forces at work affecting its price.
''Rising rates in the United States have forced up the cost of holding non-yielding assets and, as gold is denominated in US dollars, it has not been a very good investment for any foreign investor because of the poor performance of the US dollar.
''In addition, the resurgence of global inflation, which many gold bulls predicted, has not yet occurred.
''Even against this poor background, it seems to have held up well, probably because there has been a general increase in demand for commodities. Gold has remained cheap and there is still the likelihood that within the next year or two it will break significantly out of its current trading range.'' Lennon Chan, a director of Tai Fook Securities, said the crackdown on retail foreign exchange dealing in Hong Kong by the Securities and Futures Commission could result in an increase in gold bullion dealing.
