What Is a Gold Bull?

Malcolm Tatum

A gold bull is a term that is used in investing circles to refer to the phenomenon of a market that is currently experiencing or is about to experience an increase in the value of gold traded in that market. In a similar application, a gold bull may actually refer to an investor who believes that the price of gold is about to increase and is making arrangements to take advantage of that market movement. The slang term itself identifies the type of asset – gold – that is the focus of the activity, while also indicating that the price movement associated with that asset will be upward rather than remaining stable or decreasing.

As with other kinds of investments, investors must assess how long a rise in gold prices will last.
As with other kinds of investments, investors must assess how long a rise in gold prices will last.

With a gold bull market, there is anticipation that certain events are about to occur that will cause the market price of gold to increase. The events that may lead to this increase in the value of gold may have to do with economic factors that trigger an increase in demand for the amount of gold currently on the market, or a sudden scarcity of the asset without any real decrease in demand. At times, an increased interest in gold as an investment may occur when other types of assets are losing value in their respective markets, owing to the occurrence of a recession in the general economy, changes in consumer tastes, or unanticipated events like a natural disaster or a political coup.

Working within the context of the gold bull market, the gold bull investor will often seek to identify an upcoming trend indicating that the price of gold is about to increase significantly. As part of this process, the investor will also attempt to project how long the upward trend will last and how high the price of gold will actually go. From there, the investor can make arrangements to ride that investment wave for as long as possible. The strategy may involve buying gold at the current low prices and holding the assets until the wave is anticipated to crest, then selling those assets just before the prices begin to drop once more.

The gold bull is the opposite of the gold bear, a situation in which there is reason to believe that the price of gold will shortly enter a downward trend. With gold bear, there is usually a move by investors to sell off their shares of gold before the price decrease actually commences, making it possible to avoid incurring losses. As with "gold bull," "gold bear" may refer to an anticipated or emerging market condition or to the investor who seek to reap the most benefit from that condition.

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