Gold has been coveted throughout human history for its color, malleability, and other special properties. Let us understand why gold is still a great investment in India, UK, USA and across the globe. Gold is highly recognize due to its great monetary value and historic history. It’s been used as a currency since about 550 B.C.E.
Today, gold is consider as a strong investment vehicle. When the dollar weakens and the stock market drops, gold retains and even gains value, so it’s a great hedge against inflation and market risk. While the price of gold can be volatile over a shorter timeline, gold tends to hold its value well over the longer term, and it’s got street cred as a crisis commodity, too.
Gold Holds Its Value
One of the biggest reasons why many investors put their money into gold is because it holds its value well over time. Gold has intrinsic value that isn’t link to the value of the local fiat currency or the stock market.
That means that when inflation drives down the value of the dollar, gold holds onto its value. Often, the spot price of gold goes up when inflation is high, as investors seek the security of gold to protect their money. Currency may lose its value, but gold retains and gains value, especially over a long period of time.
Gold Can Protect Your Portfolio from Market Crashes
There’s always some amount of risk involved when it comes to investing in the stock market. Even when times are good, you know there’s going to be a recession eventually. You typically can’t predict when that will be.
One way to add some diversity to your portfolio and protect your wealth from inevitable market downturns is to put money into gold. The value of physical gold is not link to the value of the stock market, and when the market goes down, investors flock to the perceived security and safety of gold as an investment vehicle. This can drive up the price of gold in a bad economic climate, which can keep you from losing everything to a market downturn.
Gold prices tend to be lowest at times when the stock market is booming, so it’s a good idea to buy gold during good economic times to hedge against market risk later on. You might be surprise how much value your gold holdings can gain when the market crashes.
In 2008, during the throes of the Great Recession, the price of gold was three times higher than it had been just ten years earlier, when times were good and the market was booming. By 2012, the price of gold had doubled yet again from its 2008 high, and it hasn’t gone down that much.
In Times of Crisis, You Need Gold
Investors flock to gold in times when crisis appears to be looming, including times of civil and government upheaval. Putting all your wealth into gold can be a good way to make your assets portable in case you need to flee from war or civil unrest. In times of unrest, when currency may not be useful, you can still use gold as a currency to buy the things you need.
Of course, if you want to be able to grab your gold and take it with you at a moment’s notice, you’re going to need to buy gold bars or coins instead of investing in gold mutual funds or gold exchange-traded funds (ETFs). Gold mutual funds and ETFs can be good investments, giving you both the security of an investment in precious metals and the sellability of market shares. But you can’t trade in your ETFs or gold mutual funds for an equivalent amount of gold.
Buying Physical Gold Guarantee Fast Access During Crisis
However, when you buy gold bullion, you can take possession of it and store it in your home or in a safe deposit box at the bank. If you’re buying gold to protect your wealth in the face of civil unrest or political instability, you’re going to want to keep your gold where you can access it in a hurry – somewhere on your property. Buying physical gold and taking delivery of it is the easiest way to guarantee fast access to your gold.
You can sell your physical gold whenever you need to liquidate it – it’s easier to sell than some other precious metals. If you’re not sure you can keep gold safe at your home, or don’t have room to store it, and aren’t worried about needing it in a crisis situation, you can store your physical gold at a gold storage vault, and sell it from there, too, with no need to ever take possession of it.
Conclusion
Gold remains a good investment, especially if you want to protect your wealth from inflation and economic downturns, or even social and political unrest. An investment in gold is an investment in a long-respected form of wealth that will help you protect your assets for the long term.
The price of gold rises in response to events that devalue paper investments such as stocks and bonds, making it an important component of a well-diversified investment portfolio. While gold’s value varies in the near term, it has historically stayed steady over time. Hope now you understand why gold is still a great investment in India, USA, UK and across the world.
