Investment Guide On Gold

Gold Investing Guide: The Basics You Need to Know for Effective Gold Investing

Gold can be one of the most important and protective elements in your retirement portfolio. Beyond its most common importance as a means to diversify a portfolio, because of gold’s relative rarity and its special qualities as an asset class––in a way unlike most other investments––gold doesn’t move in line with other assets such as equities or property.

Consider gold like insurance for your portfolio. Most investment experts recommend that investors allocate anywhere between 5%–15% of their portfolios into gold.

Why Is Gold Like Investment insurance?

• Not only does gold not move in line with investments like stocks and bonds, it tends to move in the opposite direction. Therefore, in events like stock market crashes, bursting credit bubbles, or skyrocketing inflation, gold’s value actually goes up.
• If gold is an alternative to paper currencies, as if commonly argued, you could also argue that the price of gold will be determined by how much investors trust the integrity of paper money. As a result, when paper currency is debased by governments or devalued by inflation, gold gains in value.
• Look at history: In 2001 an ounce of gold cost $271. Within 10 years it had reached $1,896, an increase of almost 700%. This period, which saw banks collapse and currencies quake, was also one of the stormiest economic periods in recent history.
• During periods of economic disaster, investors often move to gold as a safe haven. Unlike money, gold can’t be printed or debased – physical gold is the ultimate savings vehicle.
• In the same way that your home should not be regarded as an investment, gold bullion is not an investment per se, rather a form of “saving for a rainy day.”

You wouldn’t trade an insurance policy, so don’t trade your gold.

Gold and Inflation

Gold tends to hold its value against inflation––i.e. Gold can go up during periods of inflation and drop during periods of low inflation. Currently, the inflation rate is very low––in fact, many argue that it’s too low and worry about potential deflation. Gold will hold against deflation as well.

Over the long term, gold is still considered one of the best hedges against inflation or deflation available.

Other factors that favorably act on gold’s value are low growth, big public debts, and high unemployment – all things that have not subsided since the Great Recession. Precious metals continue to find support in both retail and institutional investor portfolios. This support recently got another boost from another class of investors – elite billionaire hedge fund managers.

Why You Need Physical Gold

Physical gold is a universal finite currency. Did you also know that it is coveted and held by most central banks?

Gold is a good way to ensure wealth preservation and for passing wealth from one generation to the next. The true benefit of gold is best realized in owning the physical product: gold bullion. Only once you’ve got bullion in your portfolio, then can other investments such as mining shares, investment funds, and other more speculative gold investments be considered.

What to Know About Purchasing Bullion Coins

Bullion coins allow investors to own investment-grade gold legal tender coins guaranteed by the integrity of the governments that produce them.

While bullion coins can also have numismatic value which can add to the investment value of coins––case in point, the rise in value of previous issues of Chinese Pandas––the value of bullion coins and bars is more often determined by the price of gold, and thus follows the bullion price.

Gold, silver, and platinum are all available in the form of bullion coins, minted in the U.S., the U.K., in Canada, Austria, Australia, China and other countries. Most bullion coins are minted in a variety of sizes and denominations but for investment purposes one ounce coins are most recommended as having the most value and lower premiums. One-ounce gold bullion coins such as American Buffalos or American Eagles are by far the most popular for both small investors and larger scale buyers who see the advantages of owning legal tender bullion coins, either in their possession or in depositories, and recognize the advantages of the divisibility and liquidity afforded by them.

Learn More on the ABCs of Gold Investing

Now that you know where to begin you’ll want to know more about understanding the basics of precious metals investing, the pros and cons of investing in gold, how to start investing in gold, and more. The best place to start finding answers your questions and discovering the vital information that could save you thousands of dollars is in our new mini-course. This valuable guide is available for FREE download and is certainly worth a minute of your time to acquire.

Don’t leave yourself unprepared when the next financial crisis comes! Get our free information and begin protecting your precious nest egg today!