My mother loses $3,800 in three weeks by buying gold at peak prices

In early March, my mother decided to pull all her money out of her savings account because interest rates were too low and the returns were not “worth it.” Gold prices were climbing at the time, at one point reaching a peak of over VND190 million per tael (1 tael = 37.5 grams or 1.2 ounces). People, including my mother, believed then that the metal would continue to go up due to the Middle East conflict and the resulting global instability.

She followed the advice of a few friends and bought five taels of gold, nearly using up her entire savings. I neither objected nor supported her decision, as it was her money and because part of me had also bought into the gold hype.

But just three weeks later, gold prices fell sharply to below VND170 million per tael. One evening, I saw my mother sitting quietly in the living room, occasionally sighing as she tallied her losses: about VND20 million per tael, or roughly VND100 million in total. To add insult to injury, bank interest rates were on the rise, meaning she was losing on both fronts.

All I could say was: “If anyone could predict the market, everyone would be rich.” She forced a smile, but I know she regrets her choice.

I believe her story mirrors that of many inexperienced investors who, lacking financial knowledge or a clear strategy, follow the crowd out of a fear of missing out and end up buying at the peak.

Gold, like any other asset, is influenced by many factors, including geopolitics, interest rates and market sentiment. I do not know whether my mother will break even, but one thing is certain: she learnt a costly lesson.

Her story also reminds me to get a clear understanding of what I am investing in and the risks involved before putting down my money. And sometimes, doing nothing can be safer than following the crowd.

*This opinion was submitted by a reader and translated into English. Readers’ views are personal and do not necessarily match VnExpress’ viewpoints.