Home > Blog

Reasons You Should Invest In Gold

Are you thinking of investing in gold and wondering about the gold price predictions?

Gold has a history that is unlike that of any other metal.

For thousands of years it has been placed on the heads of kings and queens, used as a currency and standard for global currencies, it has been the prize for champion athletes, and the list goes on.

What makes gold so valuable are its actual physical and chemical properties that make it the most malleable and ductile of metals. Add to that its aesthetic appeal, and you have an undeniable store of value. Below are a few reasons why you should consider including gold in your portfolio.

  1. Gold is a tangible asset

With gold, you have not only a tangible but strategic asset that is considerably more secure than any of your other assets. Most other assets, such as real estate will always be at the mercy of the elements, and as such, they are always at risk. Bank accounts can be wiped out by hackers. Gold, because of its nature, will give you peace of mind and the security that other asset classes simply cannot.

  1. It adds diversity to a portfolio

Gold allows you to diversify your portfolio by adding a tangible asset that can protect you from volatility because the factors that affect the returns of other asset classes both on a macro and micro-economic level do not significantly affect the yellow metal. Thus for the given returns from a portfolio, adding gold can help reduce risk.

  1. Can be a hedge against inflation

Gold has an inherent value that it has retained throughout the years, and this makes it a great store of value,particularly in inflationary environments.  As inflation rises and currencies continue to weaken, having gold as part of your portfolio means the value will be retained when other asset classes are recording losses. And with gold price predictions looking favorable at present, this may be a great time to invest.

  1. Gold is a scarce metal

Another reason that adds to the value of this precious metal is its scarcity. Estimations on just how much gold exists vary but the number is comfortably over 150 000 tons with speculation that the world would run out of mineable gold by the year 2035. That certainly is something that will help gold retain its value.

  1. Gold can provide liquidity

Unlike with most other assets such as real estate, gold investments can be liquidated considerably faster when gold price predictions are up. The advantage that gold has, except for sovereign bonds, is that it has no lock-in period like most other assets. For physical gold, the redemption amount will depend on its purity and other market factors, whereas for paper gold, the market price on the redemption date will determine the amount.

Investing in gold is a solid move

Finding a sure store of value is something that most people desire. The world of today constantly goes through troubled economic times and people are always on the lookout for ways that can cushion them against the next financial downturn. Gold is one such way that can be used to hedge against the volatility in the markets. Having been around as a store of value for thousands of years, it is unlikely that its status will change shortly.  If not for anything else, the diversity it will add to your portfolio is recommended.