Gold Price: Entry Points 'Are Coming' as Volatility Rises, BofA Says

Core Viewpoint - The current market for gold is perceived as overbought, yet it remains underinvested, indicating potential for growth in client portfolios and wealth management [1] Investment Insights - There is still room for increasing gold allocations, with the highest historical allocation being 1.1%, while the current allocation stands at 0.5% [1] - ETF inflows for gold have surged by 880% year-over-year, raising concerns about sustainability of such growth rates [2] - The market may experience volatility, with potential entry points for investment as price movements fluctuate significantly [3] Market Dynamics - The gold market is influenced by macroeconomic factors, including fiat currency dynamics and debt levels, suggesting a fundamental basis for its value beyond speculation [4] - Gold is recognized as an asset that plays a role in portfolio diversification, with optimal risk-return profiles suggesting a 30% allocation in gold for high-risk portfolios [5] - Despite its limited performance in the real economy, gold still provides price exposure and diversification benefits within investment portfolios [6]