Is gold a good investment? Why should you own it?
It’s natural and even prudent for an investor to wonder if a particular asset is a good investment or not. That’s especially true for gold, since it’s an inert metal and doesn’t earn any interest.
But the reasons for owning physical gold go beyond the possibility of its price rising. Gold bullion offers distinct advantages that simply can’t be found in almost any other investment. These advantages give you power as an investor. And yes, one of these reasons is because the price is poised to rise significantly (see reason #10).
Let’s first dispel with a common misconception about gold: it doesn’t pay interest or dividends so is not a good investment. But gold isn’t supposed to do that, and that’s a GOOD thing…
Owning gold means you don’t have to worry about earnings reports, changes in dividend and interest payments, or unhappy shareholders. It’s one of few assets where those factors are not present, freeing it up to do what it has done for thousands of years: store value for you.
An ounce of gold can buy a nice suit today—just like it could hundreds of years ago, and even thousands of years ago (a Roman toga). There are times when it will buy or less, but it has always come back to this equilibrium. This track record is unmatched by any other investment.
This multi-millennia history makes gold a unique investment in the modern world. The fact that it acts as a store of value is just as strong today as it was when Kings and pirates used to hoard it. Central banks buy gold for their Reserves today, as well as millions of investors. And since gold is virtually indestructible, it will outlast you… and your heirs.
And this highlights a critical point: to capture all these advantages, you must buy physical gold. Not paper forms like ETFs or futures contracts, but gold bullion, like coins and bars. Do that and the following advantages are yours.
Here the top 11 reasons why every investor should buy some gold bullion, with emphasis on investment implications…
1. Gold is Money
Gold is not used as a currency today, but its role as money makes it superior to any currency. In fact, gold has been money longer than any currency in history. Gold has been a store of value for at least 3,000 years, while one of the longest currencies in history, the British Pound, is about 1,200 years old.
One of the crucial promises of money is that it serve as a long-term store of value. Gold fulfills this promise better than any fiat currency. Look how much purchasing power all major government currencies have lost compared to gold.
2. Gold is a Tangible Asset that Can be Stored and Retrieved Easily
To invest in gold is to invest in a physical asset that has value. Unlike stocks or bonds, gold can’t be created or destroyed, so it’s easy to store and retrieve if you need to.
Gold is also valuable because it’s rare – there’s only so much of it in the world. That means that its value isn’t likely to go down anytime soon.
Additionally, it can be bought rather easily. For instance, you can easily find the best precious metals IRA companies and buy gold from them. Also, some companies will even store the gold for you.
3. Gold Has been Used as a Form of Currency for Centuries
As civilization has progressed, different forms of currency have been used. Currency originally took the form of bartering goods. Then, as society became more complex, precious metals like gold and silver were used as a way to standardize trade. Gold, in particular, has been seen as a valuable form of currency for centuries. In fact, it’s still seen as a valuable form of currency today. Even though paper money is now the most common form of currency, gold still has a place in the world economy.
4. Gold is Not Affected by Inflation or Economic Recession
One of the most common reasons people invest in gold is because it is seen as a safe haven asset. This means that it holds its value well during times of economic recession or inflation. Unlike stocks and bonds, which can lose their value during these times, gold typically increases in value. This makes it a good investment for those who are worried about the economy.
Another reason to invest in gold is that it is a hedge against inflation. This means that if the price of gold goes up, the purchasing power of your money will go down. By investing in gold, you can protect yourself from inflation.
Finally, gold is a good investment because it is not affected by the stock market. This means that if the stock market crashes, your investment in gold will not be affected. This makes gold a good choice for those who are worried about the stock market.
5. Gold is a Global Commodity, with Many Uses Beyond Just Investment
You may have heard the saying, “Gold is money, everything else is credit.” While this may be true to some extent, gold is also a global commodity with many uses beyond investment. In addition to being a form of currency, gold is used in jewelry, electronics, and even medicine. As such, it is not influenced by any one nation or economy and has the potential to provide stability in uncertain times.
Gold is also rare, making it a valuable commodity. The supply of gold is limited and will not increase in response to economic demand like other commodities such as oil or copper. This rarity gives gold an inherent value that can protect your wealth in times of inflation.
6. The price of gold is relatively stable, making it a safe investment choice
What makes gold such a valuable commodity is its rarity. The precious metal is difficult to find and extract, so its price isn’t subject to the same volatility as other investments, like stocks or bonds. You can expect the price of gold to slowly rise over time, making it a safe investment for anyone looking to protect their wealth.
If you’re looking for a safe investment to protect your wealth, gold is a good choice.
7. Gold Provides Portfolio Diversification, Which Helps to Reduce Risk
Since the beginning of time, gold has been recognized as a global currency, store of value, and investment asset. For centuries, central banks have diversified their portfolios with gold, which has helped to stabilize their economies. Today, private investors are increasingly turning to gold as a way to protect their wealth and preserve their purchasing power.
Gold is an effective hedge against inflation and it has been used as a global currency for centuries. Gold is also a valuable diversifier for portfolios, helping to reduce risk and protect wealth. These are just some of the reasons why investors around the world are turning to gold as a safe haven asset.
If you’re looking for ways to preserve your wealth and protect your purchasing power, investing in gold may be the right decision for you.