Gold price volatility is prompting a shift in investor sentiment. The gold market is experiencing robust activity in both buying and selling, with the primary focus now turning to risk management.
On February 10, despite being a weekday, the flagship Caibai Jewelry store in Beijing was crowded with customers. Amidst high and fluctuating gold prices, large-scale liquidations have become frequent. One notable case involved a woman who sold 8 kilograms of gold bars in a single transaction, drawing significant attention. Concurrently, many investors, seeing prices stabilize, are actively entering the market. While numerous buyers are purchasing several kilograms at once, smaller-denomination gold bars remain the preferred choice for the majority.
The woman explained that the 8 kilograms of bars were accumulated through purchases over several years. She presented a meticulously organized booklet containing purchase vouchers, invoices, and certificates for each bar. However, because each of the dozens of bars had to be individually unpacked, weighed, and authenticated, the transaction took staff over an hour to complete.
The repurchase price for the gold was 1,120 yuan per gram. After deducting a手续费 of 3.8 yuan per gram, the investor netted nearly 9 million yuan. Store personnel noted that million-yuan-level liquidations are now a daily occurrence, with 8 kilograms not even being the largest amount. Many of these sellers are investors who accumulated bars over previous years. While they held onto their assets during the recent sustained price increase, the current period of high volatility has prompted more to sell.
An elderly man waiting in line shared that he buys gold bars annually—ranging from 100 grams to 500 grams—and has accumulated over ten kilograms. Although he remains optimistic about gold's long-term prospects, he decided to sell a portion to mitigate risk. He mentioned holding tight during the price surge but feeling the need to reduce his overall cost basis after the recent price pullback, adopting a strategy that allows flexibility.
In response to the market volatility, gold stores are adjusting their policies. Caibai Jewelry recently announced new repurchase rules effective February 6. Repurchase services for precious metals are suspended on weekends and public holidays—non-trading days for the Shanghai Gold Exchange. The store has also implemented limits on repurchase volumes, including daily maximums per client and per transaction.
Industry experts suggest that suspending repurchases on non-trading days is a risk-control measure, while volume limits help manage cash flow pressure. For instance, Caibai requires appointments for repurchases exceeding 3 kilograms. Other gold retailers, such as China Gold, offering repurchase services have introduced similar regulations.
Alongside large-scale sellers, there are also many buyers purchasing kilograms of gold at once. However, to manage risk, the prevailing trend is towards making multiple, smaller purchases.
On January 30, following a sharp drop in international gold prices, activity at Beijing's Tianya Jewelry City—often compared to Shenzhen's Shuibei market—plummeted. The "buy high, not low" mentality was evident, with one merchant noting a complete halt in sales despite lower prices, contrasting sharply with the previous day's busy trade.
As prices entered a phase of high fluctuation in recent days, investor interest in buying has resurged. However, preference has shifted strongly towards smaller bars for better risk control. Store staff frequently remind customers that 10-gram bars are often sold out, with 20-gram bars being the smallest available. They note higher processing fees per gram for smaller bars, suggesting larger purchases for cost efficiency.
One regular buyer reported visiting daily, aiming for the smallest denominations, but often finding even 100-gram bars sold out. He adopts a strategy of分批购买, buying in stages, as prices fluctuate around 1,100 yuan per gram. He mentioned a paper profit on a 100-gram bar bought just the previous day.
In contrast to the bustling investment gold bar section, the jewelry counters are noticeably quieter. Many traditional jewelry buyers are转向ing towards investment bars. One young man decided to buy a gold bar with his year-end bonus instead of a bracelet for his wife, feeling it was a more substantial gift. An elderly woman purchased five 20-gram investment bars, explaining that while she used to buy gold jewelry as gifts for her grandchildren, gold bars now seem more appropriate.