Investors who boast the most impressive portfolios invest in a wide range of assets, one popular choice being gold. But why invest in precious metals?
Historically, gold has shown a positive correlation when compared to inflation (CMC 2020) In short, as the value of currency depreciates, gold holds its value or rises.
In fact, in recent weeks the price of gold has sky-rocketed to an all-time high, gaining more than 18% in market value since January 2020 (thisismoney 2020). Many analysts attribute its appreciation to investors reallocating their wealth into gold after the pandemic-induced stock market crash (CMC 2020)
Silver has also seen a 60% increase this year already (SeekingAlpha 2020), due to physical demand, prompting analysts to suggest another surge in the value of the metal will take place later on in 2020.
Still, in comparison to the sudden appreciation in the price of silver, gold still offers balance to an investor’s portfolio with the reliability and stability it has shown over the past nine years.
So, as both gold and silver continue to steadily rise, their liquidity continues offer those who invest the opportunity to grow exponentially- even within a turbulent economy.
