The Best Time to Buy Gold & Silver in 2024

Can’t decide if you should buy gold now or wait?

We looked at the historical data to see if we could identify the best time of the year to buy. Is there a best time of year to buy gold?

To fully answer that, let’s start at the beginning.

Why Buy Gold?

We don’t just buy gold in isolation. We buy gold as part of a portfolio – part of a broader strategy, and we choose our allocation to gold relative to our allocation to other assets. One of the best frameworks for choosing these allocations is through the lens of economic risk.

When people feel safe and secure financially, they take more economic risks: they start their own businesses, they buy more products and services from other business, and of course, they invest directly in other people’s business. Put another way, people (1) form companies, (2) give money to companies, and (3) buy the stocks of publicly traded companies. That’s a risk-on environment.

The opposite case, unsurprisingly, occurs when people feel worried, anxious, or insecure about their financial prospects. They spend less, save more, and pull some of their chips off the table. This causes stocks prices to deflate, and that lost investment tends to move into safe havens like gold.

So, when is the best time to buy gold?

The Dow/Gold Ratio

A good time is when you personally are worried about your financial future. The best time is when other people are worried about theirs too. We can indirectly measure the collective “risk” sentiment of all investors by comparing stocks (the Dow Jones) to gold. By taking the ratio of the two prices, we can see how the two assets move relative to each other. This forms clear bull and bear markets for risk itself.

When the Dow/gold ratio is moving up, stocks are outperforming gold, and we’re in a risk-on environment. When that switches to a risk-off environment, the ratio reverts, moving lower, which means that gold is outperforming stocks during that period (three red circles in the chart).

The ratio moves up and down in long term cycles that usually play out over at least 10 years per move. The fast corrections tend to be when gold does better. Those are shorter periods of risk off. But generally speaking, there are long periods of risk-on where stocks outperform gold.  

So where are we right now?  

In 2024, the Dow gold ratio runs about 19, far larger than the historic mean of 9.7 or the median of 5.5. What this means is that over time, if this trend were to continue the ratio would revert to something below 5.5, quite possibly even to its historic low of 1. If the ratio were to decline, that means that gold would be outperforming the Dow – gold would be outperforming the stock market.

Do we know that that's going to happen immediately? No of course not. The Dow gold ratio could continue to rise and form new highs over 40 or even higher. That's totally possible. But it would seem like eventually this ratio would revert to the mean.  

So, if you think the Dow gold ratio is likely to revert to its historic levels, around 5.5 or 8, then you would also think that gold would have to outperform the Dow for an extended period.

If you think that that is likely to happen soon, then now is a good time to buy gold.

The Gold Bull Market

Once you have a better understanding of the current risk environment, then the next question might be, “where are we in the gold cycle?”

We’ve covered the Dow gold ratio, so let’s shift our focus to the patterns and movements of gold prices. Gold's value, often reflected in the dollar-to-gold ratio, exhibits long, distinct cycles.

The most significant bull market in recent history occurred in the 1970s, followed by a 20-year bear market. Comparing that period with today's market, we appear to be on the cusp of the most dramatic phase - the "blow off top," where the largest historical surges have occurred. Despite a deviation in mid-2020, due to the unprecedented global shutdown, the pattern largely holds true.

“It’s just the nature of a rip-roaring bull market. Fundamentals might be good for the first third or first 50 or 60 percent of a move, but the last third of a great bull market is typically a blow-off, where the mania runs wild and prices go parabolic.” -- Paul Tudor Jones

Take 1979 as an example: Gold's price soared from $226 to $512 within a year, and then, in just three weeks, it spiked to an astonishing $873 – a 70% increase. 

Such is the nature of a blowoff top.

If history is a guide, and we're approaching the final leg of this gold bull market, now could be an opportune time for investing in gold. Recognizing the patterns and learning from the past might just position you favorably in this exciting market phase.

The Best Time of Year to Buy Gold

If you look at the data, it really doesn’t matter what month or quarter you buy gold. Over the long term the difference will be negligible.  

You want to buy this year instead of next year. You are likely to get a better price this year than by waiting till next year. Whatever amount you want for your long-term holdings, buy it this year. In the big picture, however, it’s less about snagging the exact bottom and more about how many ounces you own.

Instead of trying to time the market, you may want to consider dollar cost averaging. Dollar cost averaging means investing the same amount of money in a target security at regular intervals over a certain period of time, regardless of price.

If you’re looking to add to your gold portfolio, but are wary about making a large purchase, dollar cost averaging could make sense for you:  

• Mitigates Timing Risk: Dollar cost averaging reduces the risk of investing a large amount at an inopportune time. By spreading your purchases, you're less affected by short-term market volatility.
• Consistency and Discipline: Regular investments through dollar cost averaging enforces financial discipline, encouraging consistent saving and investment habits.
• Accessibility for All Budgets: With dollar cost averaging, you can start investing with smaller amounts, making gold investment accessible regardless of your budget.
• Suits Long-Term Investment Goals: Dollar cost averaging is particularly effective for long-term investment strategies, with the goal of building wealth over time.

One of the easiest and most effective ways to dollar cost average into precious metals is InstaVault.

What is InstaVault?

InstaVault let’s you buy instantly, sell instantly, in the vault instantly – InstaVault is a cost-effective way to get exposure to physical silver and gold.

InstaVault gives you the ability to quickly buy fractions of large, industrial-weight bullion bars.

You get shared interest of a 400 oz or 1000 oz gold or silver bar with the flexibility to buy and sell when you want to or convert to whole coins and bars for home delivery any time.

And all the benefits of owning physical metal, the low premium of large bulk bars down to a single ounce, and the options you need to quickly take advantage of markets:

• No minimums: Buy in the increments of your choosing – affordably build a position or make a bulk investment, it's up to you.
• Full, Instant Liquidity: You can sell any time after your order is settled, add to your position on dips, or hold and monitor your investment online.
• Always Available for Delivery: Want your metal in your hands? You can request delivery at any time, as whole coins or bars of your choosing, shipped right to you.
• Maximum Ounces for Your Currency: Invest as little as you want and enjoy the very same super affordable bulk pricing as our largest silver bars.
  100% Pure Metals Exposure: Every cent you invest is put into physical silver and allocated to you (in your name) as fractional ownership of large silver bars.
• No futures, no IOUs, just physical precious metals in your name at our secure third-party vaults, available for delivery or sale at any time.
• Lowest Bid/Ask Spreads: Buy and sell physical metal at market rates (as close as we can offer to the underlying spot price while still providing real physical investment).
• Full-insurance and Security: Your silver is held outside the banking system in class 3 vaults in Texas or Delaware with 24/7 surveillance, armed guards, full replacement insurance, and regular verification by independent auditors.

InstaVault is secure, liquid, and simple. Invest today in increments as little as 1 troy ounce for silver and 1/100th troy ounce for gold.

Take Delivery Any Time With Conversion

With InstaVault, you own a fractional interest in real physical bars stored in our network of independent vaults in the U.S. You can take delivery of your holdings at any time. Simply request delivery with conversion into common forms of whole-ounce bullion in any quantity, for a small exchange fee and insured shipping charge, by logging into your account online. (Note: You cannot take delivery of a 1,000 oz silver bar or 400 oz gold bar. And you may only convert InstaVault ounces to our set list of fixed-weight, whole ounce products.)

Storage & Insurance Fees

InstaVault Silver investors are charged an extremely low monthly storage and insurance fee to offset the costs of safeguarding all customers' investments. You’ll pay just 0.06% of the value of your silver per month, that’s just $0.60 cents for every $1,000 invested – less than a dollar. These fees are billable by credit/debit card and do not come out of your silver. There are no minimum fees as there with whole coin and bar allocated storage.

If you’ve been asking, “is now the best time of year to buy gold?”, the answer is right now. Learn more about investing with InstaVault today.