What Are The Advantages Of Gold As An Investment


Many investors considering the option of gold initially question whether it’s a wise choice and why they should add it to their holdings. When developing an investment strategy, it’s to your advantage to question each asset before you commit, particularly a precious metal like gold, since it’s an investment that won’t earn interest or dividends.

The suggestion is that gold provides distinct advantages unto itself that many other assets don’t aside from the realm of possibility for the price to rise. With those sorts of advantages, an investor gains some control with holdings where the power might be more so in the hands of the financial or stock market if a portfolio were heavy in paper.

Its strength as a “store of value” is as great in the world today as it has been throughout the course of history. The durability and indestructibility of the physical commodity render it capable of withstanding the test of time regardless of the abuses it might encounter. 

This is seen when purchasing gold bullion, whether bars or coins, whether you do so with an online platform, auction provider, or precious metals dealer.

The recommendation is to research precious metal firms, like checking this review at https://www.bondsonline.com/monex-precious-metals-review/, to find a well-qualified, experienced and knowledgeable resource from whom you can purchase gold products. 

A reputable dealer will likely display their bullion with documentation clearly indicating purity. If this is not documented, a trusted company will be forthcoming when the questions are asked. Let’s look at a few advantages you could see as a gold investor.

What Are The Advantages Of Gold As An Investment

When developing an investment strategy and deciding on assets for a diverse portfolio, it’s wise to question each option with a financial advisor to learn what it will do for you and why you should include it. 

Adding gold is no different and is, in fact, one most people question whether they should add the precious metal and what advantages it can bring. See here for details on whether it’s still worth it to invest in gold.

While the physical commodity might not earn dividends and interest for its investor, it’s one of the few assets where investors are free of “unhappy shareholders, the potential for changes that come along with interest and dividend payments, and the worry of dealing with earnings reports.” 

Instead, the client can focus on the fact that the precious metal stores value. What else can it do? Let’s learn.

  • The physical commodity is a tangible asset

When you purchase physical gold, it’s something you can touch, which is untrue with most assets. The metal is virtually indestructible with its ability to withstand being submerged in water with no resultant flaws, fire will not mar the surface, and time doesn’t wear the metal. It doesn’t require maintenance of any sort.

Unlike the potential with digital currencies, there is no possibility of being erased or hacks and no chance for identity theft. In the modern world today, many people have their identities tied up digitally. It’s wise to place some in another platform for protection.

In a world where we never say never, there is every bit the possibility for the internet to crash, the digital arena to have a major hiccup, and everyone to lose all the records they have online (a little far-fetched, but nothing is impossible). What will you be able to rely on in those circumstances? Your gold bullion – these could actually prove life-saving.

  • Gold allows for discretion

There aren’t many assets that allow complete discretion when you want to make an investment, except with physical gold. That doesn’t mean that you won’t have to report it with your taxes, but the class is one of the few where the investor has the option of remaining anonymous.

If you don’t want anyone to know you own it, no one will know. That’s not possible with a majority of other sorts of investment categories.

  • The physical commodity is not only liquid, but the product is portable

Not only can you sell gold relatively easily, but you can also bring it with you if you so choose in order to display it for those you hope to sell it to. That’s likely not wise, however, considering its gold and considerably high risk for theft. If you carry it on your person, you could put yourself in danger of harm. 

The precious metal is highly liquid, with nearly any precious metals dealer worldwide having the capacity to identify gold bullion with interest in buying it. Many times, the firm with whom you purchased the product, if they’re a reputable resource, will offer a “buy-back” agreement at the time of purchase, so when you do consider selling, you can bring it back to them and receive optimum terms.

  • Gold requires minimal storage space or maintenance costs

Storing gold in a professional storage facility does require a fee, but the suggestion is that “vaulting costs are minimal” and provide adequate safety and security with no headaches. Some people prefer to keep their gold in the home where they can watch over it. That’s the least safe not only for the gold but, most notably, for the homeowner.

The precious metal takes up very little space for the exceptional value it can hold. For example, the indication is a piece of gold the size of your palm can equate to $50,000, with the suggestion that a safe deposit box is much more secure storage than in the home and can hold this sort of exceptional value.

Final Thought

You’ll find other precious metals, including silver, palladium, and platinum, considered precious like gold because each is a rare occurrence for the Earth’s crust. Still, with each of these (aside from gold), the health of the economy will have some bearing on whether there’s a demand for them.

Gold is relatively monetary. It can stand out as its own entity and manage quite nicely without correlating to a market or much of anything really. So when others like these metals and paper assets are dealing with crisis and exceptional loss because of economic downturns or a market crash, gold is over here holding its own with even the possibility for an increase in value during the rough times.

Should you invest in gold? Investing is a very personal decision that you should always question with a financial advisor who can help you establish a strategy that works toward your personal investment goals. Still, a 5% addition can store a little value without creating too much risk. Remember, check with an advisor before making any commitments.