3 Reasons to Buy Gold
Whenever economic times become uncertain, gold becomes the most viable investment. It safeguards the resources of the investors and helps in maintaining liquidity as well. A surge in gold prices has already been forecasted by economists and if you are thinking about making sane investment decisions, gold can become your safe haven. Metal sector has performed very well in 2016 and 2017 will not be any different. The shine of the yellow metal is set to be at an all-time high as an economic downturn could increase the risks of investment.
Gold will add more value and shine to your portfolio this year. A 35% fall has been recorded in the Bloomberg Commodity Index since 2013. However, the SPSIMM (S&P Metals and Mining Industry) recorded its best performance in the last year with a surge of a massive 101.5%. Gold, specifically, has risen by 8.6%, a modest increase but a signal for investors to make better metal decisions in the future.
Are you planning to include gold in your portfolio this year? Here are 3 reasons why you should add Gold right now:
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Gold is safe, and a real physical asset
One of the most important things about owning gold is that the bullion is also a real physical asset. You don’t pay VAT on gold and there is no involvement of a third party. This makes gold a more viable investment idea for people who are looking to escape any financial emergencies or financial turmoil. The performance of any company or even a political instability will not be able to affect the value of your gold to a massive extent. This means a safer investment compared with stocks and even bonds. Check the value of your gold here.
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Inflation is creeping up
Interest rates could be hiked further in 2017, as promised by the Feds. This situation will lead to a rise in inflation which will be affecting the economy further. However, the good thing for gold will that the value of gold will be rising with rise in inflation. Gold can hold its value better in steadily rising inflation and consumer prices generally have a positive correlation with gold. Bonds: traditionally safe investments are usually not able to keep up with inflation. This makes gold another safe investment option for small and big investors alike.
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New presidency and now new problems
Trump is by far the most unpredictable President of the United States so far. In his short time in office, Trump has been able to create shockwaves worldwide. The political and social makeup of America is bound to change. However, as we wait for the real impact of these decisions to fully mature, it’s important to safeguard our investments. A looming recessionary pressure is still mounting on the US economy, with national debt hovering near $20 trillion.
Stocks are currently enjoying a joy ride with the state of affairs but we have already seen cracks in the market with a hyper inflated dollar and overvalued stocks. There is little real economic growth behind the staggering stock market numbers. Therefore, when the tides turn, the markets could become gloomier. Gold will provide your investment better value against the political changes worldwide until situation becomes better and stock markets highlight real growth, not just an overly optimistic market sentiment.
After researching the state of affairs in the US economy which is currently struggling with insurmountable debt, a radical political change, and uncertain global environment, it would be wise for an investor to make gold an integral part of their portfolio. It will safeguard against short term economic hiccups and provide more value to your long-range goals as well.
