- December 11, 2021
- Posted by: Robert Brown
- Category: Investing
Let’s understand first that different investments have pros and cons, and the choices we make are always personalized to our personal circumstances, which include many variables. Some of those variables include the following: investment objectives; length of time to reach your objectives; your risk comfort level; the value of your existing holdings; your unique tax consequences; your potential need for liquidity; and more. Here I named a few things that will lead each of us to our own decisions for our unique situations. Please note that I am not providing any investment advice, particularly in light of what I just mentioned above (I am not a tax, law, or investment professional, nor do I know anything about you or your unique circumstances). Let’s see how gold and silver fits into this picture.
So why gold and silver you ask?
The answer is because it has its place for almost anyone in their portfolio. Let’s review the reasons.
Both gold and silver are universal. That is, they hold their value anywhere in the world, no matter what the local currencies are doing or what the local economies are experiencing. Gold and silver is the world currency, and in fact has been the basis of currency on our planet for thousands of years.
Of the many objectives people have, some invest to build wealth, and others to sustain or protect wealth. I believe it is fair to say that most people invest to either build a financial future or to protect their financial future. Because gold and silver are precious metals, they have the innate ability to hold value – which is perfect for wealth protection. This makes it ideal to sock away a percentage of your investment dollars and to protect those dollars by owning physical bullion. By doing this, you are also building your wealth.
It is true that there are risky investments that can bring you a higher return, but it is also important to note that they are also more likely to bring you large losses. High risk investments have their place (for some people), but if you do venture there, be sure you know what you are doing and be sure to be diversified to mitigate that risk. Again, gold and silver is a perfect place for a low risk investment simply based on the fact it will always hold value by nature.
Another important point is how it relates to the economy and the changing economic conditions. Various economies move up and down the world over. These changes cause all sorts of investment to swing wildly. These changes cause inflation, and even deflation in currencies around the world. Both gold and silver values vary as well, but keep this interesting point in mind: You can pretty much buy the same amount of milk today with an ounce of gold as you were able to by thirty years ago. How’s that for stability! Don’t be fooled by the small swings in value… it is important to realize that both gold and (especially) silver have important roles in commercial use, and those demands do have a day to day effect.
So why is gold and silver a smart investment now?
In short, the answer is uncertainty. There is a great deal of unrest around the world. We have threats of terrorism abroad and at home. We have shifting world trade and power with the growth of China and other growing nations. We have an increasing threat from North Korea. We have a US President who some citizens feel is exactly what we need, yet other citizens are horrified at the very prospect of his presidency. No matter what happens here, the uncertainty is a good reason for having the stability of silver and gold in your portfolio right now.
An additional reason for investing now is the looming prospect some people feel for the implosion of our currency. People who prepare for disaster are collecting gold and silver because they can use it as currency for trading for the things they would need in such a scenario.
Whatever you reason, precious metals can make a great addition to your portfolio or a great way to start your portfolio. Just be sure to learn how to buy the right way, and do it with confidence!