Global spot gold prices have hit a new high, partially on the back of call and put options in the United States covering an unusually large number of contracts held for the sale of up to three million ounces of gold at $US1200 ($NZ1610).
The Comex division of the New York exchange struck a new peak of $US1153.40 on Wednesday night, its third record during the past 10 days' trading.
Craigs Investment Partners broker Peter McIntyre said while two central banks had recently purchased more than 400 tonnes between them, underpinning the price, gold continued its momentum this week partly due to the large number of call-option contracts covering a total of three million ounces.
Investors with call options were often looking to hedge and would buy gold at a designated price, in this case $US1200, while those with put options would sell at a designated price.
Mr McIntyre said with gold becoming a more mainstream investment, "mom and pop" investors were using US exchange-traded funds to purchase more gold.
However, he cautioned that profit-takers selling gold would conversely dampen its price to some extent.
"We will not be surprised to see gold through $US1200 and beyond a lot quicker than people have estimated," he said.
