Historically, gold has been considered a “safe haven” in times of economic and geopolitical instability as well as inflationary environments – meaning it might be an option to consider today.
Gold’s greatest potential advantage may be its tendency to perform differently from other assets.
As a result, it can help diversify a portfolio of traditional investments, such as stocks, bonds and real estate.
Of course, diversification cannot guarantee a profit or protect against a loss.
One potential pitfall when investing in gold is volatility. Gold prices can fluctuate widely.
For example, the price of gold declined from more than $800 per ounce in the 1980s to $250 per ounce in the 1990s. It is now higher than $1,000 per ounce.
Gold investments come in many forms, namely bars, coins, exchange-traded funds that track the price of gold and stocks of companies that mine and process gold.
Indeed, many investors seeking exposure to gold do so through mutual funds that invest in such stocks.
The idea is that if gold prices rise, so, too, could the profits of gold-related companies.
Of course, this isn’t guaranteed, as there are many factors that influence the price of a gold-related company’s stock, the price of gold being just one of them.
One strategy for investing in gold is dollar cost averaging, which entails investing a fixed amount of money in gold every month regardless of the price.
This strategy, while not guaranteed to be effective, could potentially spread risk out over time.
While investing in gold may be appealing in today’s economic environment, there are many things to consider before doing so.
Your financial advisor can help you determine if gold investments are suitable for you based on your individual situation and financial goals.
Is the Time Ripe for Taking a Shine to Gold?
Historically, gold has been considered a “safe haven” in times of economic and geopolitical instability as well as inflationary environments – meaning it might be an option to consider today.
Gold’s greatest potential advantage may be its tendency to perform differently from other assets.
As a result, it can help diversify a portfolio of traditional investments, such as stocks, bonds and real estate.
Of course, diversification cannot guarantee a profit or protect against a loss.
One potential pitfall when investing in gold is volatility.
Gold prices can fluctuate widely.
For example, the price of gold declined from more than $800 per ounce in the 1980s to $250 per ounce in the 1990s. It is now higher than $1,000 per ounce.
Gold investments come in many forms, namely bars, coins, exchange-traded funds that track the price of gold and stocks of companies that mine and process gold.
Indeed, many investors seeking exposure to gold do so through mutual funds that invest in such stocks.
The idea is that if gold prices rise, so, too, could the profits of gold-related companies.
Of course, this isn’t guaranteed, as there are many factors that influence the price of a gold-related company’s stock, the price of gold being just one of them.
One strategy for investing in gold is dollar cost averaging, which entails investing a fixed amount of money in gold every month regardless of the price.
This strategy, while not guaranteed to be effective, could potentially spread risk out over time.
While investing in gold may be appealing in today’s economic environment, there are many things to consider before doing so.
Your financial advisor can help you determine if gold investments are suitable for you based on your individual situation and financial goals.