Six reasons for Buying Gold Bullion
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You might have asked yourself whether buying gold bullion
is still a worthwhile idea. It can be sluggish and will not yield returns like the stock market might (when things are going well), but before you write it off as being just a thing of the past that your grandfather or maybe even your father might have done, have a look at some of the unique advantages that owning some bullion as part of your investment or savings plan can offer.
Safety is the most well-known reason. Gold
offers good protection against economic turbulence – for example in periods of inflation, market weakness or great economic and financial crisis. Gold shows proven stability as opposed to the volatile risk of paper currency and stocks. Successful investors and business people are not afraid to take risks, after all there is no reward without risk, however the most successful of these measure the risk and balance it out by investing a portion of their portfolio in something more conservative- and bullion is an ideal choice. The world’s economies are beginning to show signs of collapse and everyday more people from all walks of life are showing great interest in precious metals, regardless of where in the world they live. What other instrument can be traded or liquidated so readily anywhere and for a market price? Today, buying gold bullion
sounds like a solid idea. It makes your investments more balanced.
Nowadays, and this holds true for the future as well, in turbulent times every investor and businessman is under the influence of the market. A single man or even a corporation cannot control the free market. The competition is too strong and it cannot be controlled. So, the most savvy business people would consider buying gold bullion or investing in gold
, rather than owning paper portfolios and stocks alone. The market will not adapt to you – you must adapt to the market. Gold is a well-respected and fungible instrument that shows fexibility and real staying power.
Gold bullion can always find its market – it is easily recognised and traded. Many products during their existence at some point lose their market. Supply and demand for them vanish with the passing of time and they may disappear entirely. But can the same thing be said for gold? Not likely. Gold has always had, and always will have its own supply and demand driven market. Liquidation can be instant, unlike other asset classes such as property.
Initials for Exchange Traded Funds. It is an alternative way to invest in gold other than physical gold. These are funds that make trades on the stock exchange just like it is done with any ordinary share. It is a popular way to keep gold in an investment portfolio because it is cheap, although investing in physical gold offers other advantages.
In terms of trade in the modern market, it’s all about currency – dollar or euro mostly. However, the recent economic crisis is crucial evidence that currency is widely unstable. The economies of many countries have collapsed, choked by their dependence on currencies. Gold on the other hand has always granted a certain stability – a secure harbor for investments recognised everywhere in the world. A capable and smart investor will always maximise the numerous advantages that gold can offer. There is an old Chinese saying that it is better to live as a dog in peaceful times than as a human in turbulent ones. Considering the amount of turbulence that is battering the world economy, it is not suprising that China has been purchasing vast amounts of gold recently. It is obvious where their confidence lies.
6. Gold options
If you invest in gold options, you are speculating in gold prices, in either direction, of course. For example, if you buy a call, it’s in your best interest that prices go up. On the other side, if you buy a put, you want prices to fall. The option market is complex, so every investor has to be very careful when dealing with it. The greatest advantage is that you can control huge investments with a small amount of money. However, when a certain date expires, an option time value disappears. So, good timing and awareness are crucial in this sphere of business.
By Lisa Casagrande | https://www.goldbullionaustralia.com.au