Why Purchase Precious Metals?

In finance news, precious metals continue to rally. Why is there a sudden surge in gold or silver buying today? For many years, metals like gold and silver have always been considered as valuable. Due to the effects of inflation and the uncertainty of the global financial situation, many investors desire to hoard valuable metals more than ever. If you are considering an investment in tangible commodities, you may want to consider the information and investing tips below.

Investing In Commodities

Gold is probably the most popular commodity traded in the market today. This metal is known for its durability, malleability and ability to conduct electricity and heat. It also has some very practical applications in the fields of electronics and dentistry. In addition, it can be used for aesthetic purposes (jewelry) and as a form of currency. Today, the value of gold is determined by the market 24/7.

silver, platinum, gold bars

Silver and platinum are also popular commodities in the market. These metals, like gold, have actual value and can be hoarded for future trading or for insurance. Since these metals are tangible assets, they can be stored in safe locations and then later sold when necessary.

Factors That Affect Desire To Invest In Precious Metals

First of all, the uncertainty of the financial situation today, as reported in finance news, is a strong driving force that compels investors to store commodities that hold real or intrinsic value. Gold, platinum and silver have actual value unlike other investment vehicles. Stock certificates are actually promises that hold no real value in themselves. Paper money is just the same. Unless you use paper money to buy tangible assets, it will not have real value. Given that, a gold 401k rollover is something to consider, especially for baby boomers.

Inflation is another factor. Investors hoard gold because it maintains its value. Due to inflation, paper money decreases in value. Even when you hoard money, its worth will continue to decrease if it continues to sit in the banks vaults. In fact, after a few years, money in the bank will only retain a fraction of its original value. Regularly checking the price of gold versus the inflation of the U.S. dollar can lend some additional insight.

Choosing The Best Investment Options

There are several ways to invest in gold, silver, platinum and other commodities. However, there are investing tips you need to consider before proceeding. First of all, diversify your portfolio as a means to reduce risk. Never invest in just one option. Second, educate yourself on successful investment strategies. Hire a financial adviser to guide you throughout your investment endeavor. Remember that having a sound financial plan is a crucial aspect of an investor’s success.

four commodities

Bullion

Gold or silver coins and bars are definitely quite bothersome to store, but for people who have safe places to store them, these can become very good assets. Physical gold and other metals are good forms of insurance. If everything else fails, at least you can sell the metals you have in exchange for monetary value as needed. Nonetheless, if you have a time horizon, you may want to invest in other investment vehicles for diversity.

Exchange Traded Funds

Gold, silver, and platinum have ETFs. These investment funds are traded like stocks and form a convenient means of purchasing metals. They are very liquid and can be traded on a daily basis. However, if you want to use day-trading as a strategy, be sure to master it first on a practice account.

Stocks and Mutual Funds

If you have a big budget to invest, you can buy shares of miners. However, you have to be very aware of how stocks are valued in the market. If not, it is wise to have your account traded by fund managers who have shown excellent performances in the trading arena. If you have a lower budget, you can still trade through mutual funds pooled from several other investors.

Certificates

Instead of storing bullion, you can invest in certificates. This provides you ownership of physical gold or other commodities, but the storage will be handled by a third party. However, unlike bullion, the certificates will hold no value unless you claim the actual gold from the storage facility.

Are Precious Metals Right For You?

Keep in mind that precious metals are immune to inflation since they carry intrinsic value. They can also offer insurance against financial loss, as long as you invest in their physical form, e.g. bullion or certificates. Hence, having them in your portfolio will greatly reduce your investment risks. Nonetheless, to become a successful investor, always be open to other investing tips and keep yourself educated and updated with the latest in finance news.

Investing Tips For An Uncertain Future

Investing tips are a dime a dozen. That is especially true today, when global markets face so much uncertainty. While the Dow Jones and other measures of market activity and prosperity are showing all-time highs, many investors are not convinced. Some of the more doubtful members of the investing community are taking refuge in commodities or precious metal in particular because they fear the possible events of the next few years.

The Finance News Today

If you just look at the numbers in the finance news, there does not appear to be any reason to be concerned. But take a look at your credit report, or your chexsystems report, and it may tell a different story. Stock values are high and continue to rise. However, there is an ominous undercurrent to all this apparent happiness in the market. It may not be visible yet on Wall Street, as they say, but they are feeling it on Main Street.

The recession that began in the last decade is ongoing. While markets have recovered, many millions of people in countries like the United States have not recovered their jobs. Those that have returned to working are in jobs that have fewer or no benefits and pay a great deal less.

This leaves some people at a loss to explain how stock prices are rising and companies are making gains. Others suspect that this is all temporary prosperity based on printed money. The quantitative easing is just kicking the can down the road for the economy. The price of avoiding a crash now will be paid in long-term inflation. While there are deniers of inflation out there, one look at food and fuel prices should bring anyone back down to reality.

The recent and sustained spike in fuel prices makes a good case to ponder. Some have vocally expressed hopes that some event in the economy will turn things around and bring fuel prices back down. Wise economic thinkers have already muttered the truth. This will never happen because the price of fuel is not really the result of a spike. They simply represent the decreased value of the dollar in the last decade.

Investing Tips for Tomorrow

Given these fearful possibilities, particularly with regard to inflation, many investors are aware that their stocks are not really making gains. Their advances reflect inflation more than they do productivity. This trend will leave them in a bind when they have to use their gains as income and spend it. Essentially, their purchasing power is eroding.

In consequence, many investors are turning increasingly to commodities and precious metals with their portfolios. While they may have had quantities of these assets in their portfolios as a nod to diversification, they are now increasing the size of their commitments in this direction. Last year, billionaires like John Paulson increased exposure to gold in many of his funds to more than 40%.

Why Are Commodities Such Good Investments?

In a time like this, commodities represent a real opportunity for investment. Commodities are raw materials that exist in more limited quantities than paper currency. Therefore, as the amount of currency increases, the more stable amount of commodities tends to increase in value per unit.

Commodities can help an investor hedge against inflation this way. There are many ways to make money from commodity investment but a lot of investors these days see them as a refuge rather than necessarily another platform for profits.

The Enigma of Precious Metal

This is a special sort of commodity class that can function even better as hedges against inflation. When many people think about precious metals, they think of their primary value being in their appearance or even their utility in industry. However, one value of these assets that the uninformed overlook is their longevity.

When you invest in so many tons of wheat right now, you can count on inflation being an important, but not deciding, factor in determining future value. However, wheat must be consumed in a short period of time. The amount of inflation which a single shipment’s price can absorb is limited.

Gold, silver and platinum, though, last forever. Small amounts are consumed by industry every year but most of these metals sit in storage after they are mined. There they can accumulate value as currencies are printed.

If you want to take advantage of these investing tips, there are a wide variety of precious metal assets waiting for you on the market. Many countries mint their own gold and silver coins these days. Some are even beginning to mint platinum or palladium coins to meet the rising demand for precious metals.