Most people never would have guessed it, but people have been buying gold bars in droves at Costco (NASDAQ:COST). It’s possible that Costco’s gold bars have been so popular because gold prices are down. However, this phenomenon also speaks volumes about investors’ fear of a stock market downturn.
Earlier this month, it looked like the per-ounce gold price might finally surpass $2,000 and stay there. Yet, gold recently dropped below $1,900.
This may have been due to government bond yields surging after the Federal Reserve hinted at a higher-for-longer interest rate policy. If bonds pay high yields, gold might be considered comparatively less appealing. You wouldn’t know it, though, if you saw how fast those Costco gold bars are flying off the shelves.
Costco Gold Bars Are Selling Out Fast
It’s literally the shiny new object in the financial markets. Costco is now selling one-ounce PAMP Suisse Lady Fortuna Veriscan gold bars. Or at least, the company is trying to sell them, but apparently, it’s been a challenge to keep this item in stock.
According to Costco Wholesale Chief Financial Officer Richard Galanti, these gold bars are available online, but the company limits purchases of them to two bars per Costco member. Furthermore, this item is “typically gone within a few hours.”
That’s one angle, but we can also view this phenomenon as a surge in gold’s popularity as a perceived safe-haven asset. For folks who don’t trust the traditional portfolio mix of 60% stocks and 40% bonds (a combo that performed poorly in 2022), gold is an old standby that’s trading at a discount in 2023.
What You Can Do Now
This isn’t a specific recommendation to buy gold bars, but they can offer some value as a portfolio diversifier. Gold prices are down, so if you’re interested in precious metals, there could be a buying opportunity.
And by the way, you don’t have to wait on a virtual line and buy Costco gold. There are other places, online and in real life that sell gold in various forms. So, if you’re new to the precious metals space, I say welcome and, as always, be sure to conduct your due diligence.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.