There is an existing yellow metal buried deep into the earth, one that has been subjected to many fantasies, both by children in their daydreams of becoming rich and shareholders with a vision for a long-term investment. The said metal is gold, and America is considered to be the number one top buyer of this mineral as well as the one with the largest reserve. It is said they have almost 8000 metric tons of this asset in their possession.
And for a good reason. Gold is one of the largest assets invested in, even by central banks. Today, the shares of this mineral that central banks hold all around the world have amounted to 74% of the overall amount. Slowly, as this commodity is mined, soon it will forfeit availability in many companies and banks. Before that happens, consider investing for your retirement or even just to diversify your portfolio.
5 Facts to Know Before Venturing towards Precious Metals Resource
1. It’s A Safety Net Investment
What’s a safety net investment? In every investment venture, there is always a measure of risk, mostly financially. A safety net is just how the name suggests; it makes sure it catches you when you fall into a pitfall. It serves as a wall to lean on when you have several risky assets (paper, cryptocurrency, stocks) to make sure you still have something to hold onto in case the worst happens.
Of course, there are many forms of gold investments existing. It can be gold mining stocks, a metal resource company that offers 41k conversion to gold, or simply buying physical gold bullion, jewelry, and many other tangible states of the metal. Whichever way, this metal resource still works in a uniform manner in the market.
2. It Still Suffers Decline
Going into this venture thinking it never has dips and lows would be an erroneous mindset to start with. Like any other commodity or asset, its value takes a dive and rises up to unbelievable heights. The only difference it has compared to other commodities is its value, which never dips very close or equal to 0. It may take a dip, but it isn’t as exaggerated as paper or stock assets. Its peaks aren’t bad as well, weathering both the stock market crash, the decade of decline, and even the 2020 pandemic.
Our only advice is to go into it at your own risk and read up about gold before deciding to invest in it.
3. It Can Be A Great Form Of Generational Wealth
Gold’s value, as we all know, has been steadfast even since a thousand years ago. It’s a coveted commodity, and on top of that, its demand is rising due to a lot of circumstances, one of them the falling of the value of the dollar, the other being the ever-present inevitability of scarcity. Soon, there won’t be enough of this metal resource to go around the world, and prices of wholesale gold will spike up very high.
With these facts laid on the table, wouldn’t you consider gold to be a great spice of generational wealth for the future generation? You won’t have to worry about its decline of value, at least not so much as other commodities (like land). Much like real estate, the value might take an occasional significant dip, but its trend goes upward in the charts.
4. It Can Hedge Inflation
This mineral has a very peculiar but beneficial perk to it. It has an inverse relationship with the dollar, meaning if the paper falls in value, you’ll be sure to expect the metal’s price to spike up. On top of that, it’s a great choice as a hedging asset when every other commodity falls in price because economic and global crises are the places it thrives the most. This is the main reason it passed its $2000 benchmark in late 2020, just when the pandemic was hitting its peak as well.
5. Diversity In Your Portfolio
As we have mentioned briefly earlier, gold can quickly diversify your portfolio. Paper assets, shares, or stocks should be paired up with commodities that work against its trend, or at least only when it dips severely. The answer is gold, which helps you cover losses and counter many of the vulnerabilities of assets mentioned above.
