Gold should be an important part of your investment portfolio as it helps in diversifying the risks.
One can definitely make money investing in gold for various reasons that I’m about to explain here.
Also since it is used for purposes other than just ‘investment’ (Its value and rich history has been interwoven into cultures and it is a mode to pass on and preserve the wealth), its value doesn’t fluctuate due to the events which cause the value of paper investments such as stocks and bonds to decline.
The price of gold is volatile and there is no doubt about this fact but it has always maintained its value and worth in long term.
Here are the reasons why you should invest in gold:
- Hedge against inflation: Gold has proved to be an excellent hedge against inflation. This is because its price moves in tandem with the cost of living. If the cost of living is increasing i.e., inflation has taken its hold then the stock market plunges but gold always soars. One reason for this is the fact that gold is priced in US Dollars and thus deterioration in dollar due to inflation leads to higher price of Gold and thus it offers a stable investment than other liquid assets.
- Universally desired investment: Gold is not a national asset, it is Global! Every country recognizes its value and worth at equivalent price in their relative currencies and thus its liquidity is unparalleled! You can exchange/convert gold into cash anywhere in the world! There can be other securities/commodities which can be traded across borders but they are still restricted to some terms and conditions unlike gold!
- Crisis commodity: The ability of gold retaining its value in times of financial and geopolitical uncertainty cannot be undermined! This is the reason that it is often termed as ‘crisis commodity’ as it helps people in times of their personal as well as world tensions. When public loses its confidence on government, the price of gold often takes a hike and outperforms all the other investments. This is the reason that economists always argue that ‘price’ of gold is not indicative of its ‘value’.
- Increasing Demand: It is usually stated that of all the minerals that are mined from Earth, none is more useful than gold! Jewelry is its prime form but along with this it is used in financial form as it is preserved in form of billions; it is used in electronic devices including computers as it helps in carrying tiny currents without corroding; it has multiple medical uses and is also used in aerospace projects because of its shear strength. Due to this increased and reliable demand, its value will continue to take a high scale in future as well!
The loss of one is the gain of another; this is the rule of economy.
Value of liquid money can decline over the period of time reducing the purchasing power of people but the value of assets will continue to soar if it is profitable invested and gold is one such asset!
So where can you buy gold?
The number #1 website I recommend in buying gold is www.goldbroker.com