In the highly fickle markets of today’s worldwide economy, there are any number of reasons that people choose to invest in gold. Some people do it for security, some do it to make a profit, some do it because they fear that another great depression is coming and they hope to survive it through the hoarding of gold. When it comes right down to it, there are a couple of basic features of gold that underlie these behaviors.
First, gold has historically been the most stable currency available. Throughout history, paper and coin currencies have fluctuated along with government stability, shifts in power among the countries of the world, and loads of other events. Through it all, gold has remained more stable than anything else. Note that I did not say that gold has remained stable. Its price on the market has fluctuated, too, but not nearly as much or as widely as the price of paper currencies.
Second, gold provides a very specific combination of benefits. It is both liquid and tangible. Most other assets do not provide both. Stocks or bonds held with companies are very liquid, but they are not tangible. Real estate is tangible, but not liquid. Gold’s tangibility and liquidity, when considered with its solid price on the market, make it exceptionally valuable.
So why invest in gold?
You might want to invest in gold to diversify your investment profile. The trend in investing these days is to make sure you spread out your investments over a range of funds. Your financial advisor may suggest you invest a certain percentage in high-risk, potential high-yield funds, and a certain percentage in more solid funds. Gold can offer that solidity that things such as international or start-up companies cannot offer.
You also might want to invest in gold to hedge against rapid inflation or future disastrous events that could devalue your other investments. If there were to be a war or an economic crisis, a solid investment in gold could guide you through the difficult times.
Source by James Grayson
Bricks for Bucks - It Is Definitely Time To Invest In Gold
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