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With inflation still high and interest rates paused at a 22-year high, you may be taking a closer look at your investments. For some investors, that means considering adding new assets like gold to their portfolio.
Gold is traditionally considered a hedge against inflation as it often maintains its purchasing power when the U.S. dollar declines. And it has a reputation as a good way to diversify your portfolio, as its value tends to rise in an uneven economy.
If you’re wondering if now’s the right time to buy gold, you can start by requesting a free information kit to learn more.
3 reasons to buy gold now
These are some of the best reasons to consider buying gold now:
Gold acts as a hedge against inflation
After cooling for most of 2023 inflation actually rose in July and again in August, giving experts pause. If you’re looking to maintain purchasing power today and through future inflationary periods, gold can help. As inflation pushes the value of the dollar down, gold often has the opposite effect.
“A rise in inflation or inflationary expectations increases investors’ interest in purchasing gold and, therefore, drives up its price; in contrast, disinflation or a drop in inflationary expectations does the opposite,” the Federal Reserve Bank of Chicago has noted.
Consider adding gold to your portfolio now as a stable store of value through today’s inflation and into the future.
Gold is easy to sell
Unlike some other investment vehicles, gold is a liquid asset. There’s always a demand for gold — gold bars and coins are recognized and valued across the globe. Even Costco is now selling gold bars. The interest and purchasing power will typically remain consistent.
The value of gold, as mentioned above, will fluctuate based on a number of factors. But if you’re looking for an investment that you can sell easily if you wind up needing cash fast then gold can be smart to pursue. There are many reputable gold companies that can help you get started, too.
Gold can diversify your portfolio
In today’s economy, it makes sense to diversify your portfolio so you’re not overleveraged if and when things go wrong. For many of those looking to diversify their portfolio, it makes sense to pursue gold. While gold’s value does have short-term fluctuations, its overall value tends to remain steady over longer periods of time — especially in relation to other markets.
Instead of tying up all of your money in stocks and bonds, spreading it among different investment types could better help you manage your risk and return. By putting some money into gold — in addition to your other investments — you’ll increase the likelihood of having your money grow. Just make sure to invest the right amount. Most experts suggest limiting your gold investment to 5% to 10% of your overall portfolio.
The bottom line
Gold is a unique investment option but it may not make sense for everyone. Like any new investment, it pays to research the pros and cons before you decide to buy in. But having some gold in your portfolio could be a good way to make sure its balanced and sustainable through market changes. Have more questions? Request a free investment guide here now to learn more.
