What Makes Gold Bars A Beneficial Investment Option?

Is gold still a good investment option? This is on everyone’s mind when thinking about investment options. The simple answer is: it is, for these reasons. In 2020, the shiny metal gave a return of 24.6%. It had daily volatility of 15.81%, which is much lower than silver, platinum, and oil.

It is easy to invest in gold as you can pick from a range of pure gold bars or coins and purchase them from any reputable seller. Here is why gold bars are a beneficial investment option for you.

Hedge Against Economic Crisis

While many mistake it as a hedge against inflation, investment in gold bars actually provides protection against economic crises. History has many examples to prove this. The most recent of them is when gold tested levels above $2,000 in January 2021, after the global economies started to recover from the pandemic. Hedging against inflation is more about diversifying one’s portfolio rather than investing in gold alone.

Economic crises are rare events that occur once in a few years, and if you foresee one coming on in the upcoming years, you should invest in a range of pure gold bars to make the most of the situation. Inflation, on the other hand, occurs more frequently and may not affect gold prices as much. In this case, having a diversified portfolio with part of it invested in gold is recommended.

Hedge Against Currency Weakness

When the value of currencies falls, it usually leads to a rise in gold prices. This is especially true for the U.S. dollar. Therefore, if you have high stakes in currencies, investing in gold can be a prudent investment practice. The price of gold tripled during the decade 1998 and 2008 and doubled between 2008 and 2012. All fiat currencies have depreciated when compared to gold. Therefore, holding cash can be a loss-making proposition, while holding a gold bar can be a highly profitable one.

Global Supply Constraints

Gold usually came from the different central banks across the world, until the 2008 financial crisis put a brake on this supply. The production also declined since 2000, falling from 2,573 metric tons to 2,444 metric tons in 2007. Given these factors, gold bars make a sound investment option because, when the supply slows, the prices will automatically rise.

Low Carrying Cost, Maintenance, And Storage Cost

Gold bars are easy to buy, require little paperwork, and can be stored in your home’s safety. If you do not have a safe, you can store it in a bank’s safety deposit box. It requires no maintenance as it is not corrosive and does not damage over time. All you need is a velvet cloth-lined box or pouch to store the bar, and you can forget about it for years. It will remain as you stored it.

Owning gold is convenient, private, and does not require any specialized knowledge. Therefore it is recommended that you select from a range of pure gold bars and let the value multiply over time. The best part is that when there is a crisis, the value of your holding increases, and you can liquidate it quickly when you need the cash. All of these points without a doubt make gold a good commodity for investment.

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About Dequiana Jackson

Dequiana Jackson, Founder of Inspired Marketing, Inc., helps overachieving women entrepreneurs conquer limiting beliefs and create marketing plans that grow their businesses. This includes one-on-one marketing plan development, digital product creation, web design and content marketing. Dequiana is the author of Know Your Business: How to Attract Ideal Clients & Sell More and runs the award-winning blog, Entrepreneur-Resources.net.

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One comment

  1. Hi,
    That’s a great post!
    So informative and very useful for beginners. Good start it is. If you need any kind of help feel free to reach me at Poverty Proof Course

    Thanks

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