Diversify your investment portfolio with gold

Many people agree with the fact that investing plays a very important role in financial planning, especially when it comes to family capital. Families looking forward to improving their economic, health and social status are able to do so in a relatively small amount of time. A great number of families make money by investing in technology, pharmaceuticals or agriculture. Investing is a specialist activity that can take a great deal of time to be completely comfortable with. To be more precise, it takes practice as well as patience. There are many economic risks that can threaten the entire wealth of a family, which is the reason you should be very careful when making an investment decision.  It is essential to choose opportunities carefully, as not all of them may provide you with a steady stream of income.

One investment that you my not have thought about before, but is worth considering, is gold. Gold, namely the physical precious metal, either as coins or bars, play an important role in the modern family portfolio.  Not only does it have an intrinsic value, but also there are many tax-free gold options, if you were to purchase certain types of coins.   If you are interested in considering gold for your personal, family portfolio, please visit physicalgold.com.  This precious metal is indeed worth considering as a family asset.  

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Why you need to own gold

Gold is revered all around the world and for good reasons too. This precious metal has a significant monetary worth, not to mention a rich, cultural history. At present, not that many families consider investing in gold, or any other precious metals, for that matter. The reason for this is that precious metals are largely unknown as portfolio protection.  But, what you should know is that there are fewer risks involved when it comes to physical gold, and in times of economic uncertainty, gold has historically performed well.

In these times of uncertainty, savvy investors turn to the yellow metal in order to lessen the overall risk to their portfolio of assets.  Historically gold has outperformed other assets when you look at it as a long-term investment.  And when other assets have decreased in value,  due to global downturns, gold has historically performed well – going in the opposite direction to the declining stocks and shares.

Equally important is highlighting that gold is a universal currency. The fact is, that it’s possible to trade in the yellow metal just about anywhere in the world. Some countries actually still use bullion coins as their currency.

How much gold should you have in your portfolio?

It’s a pretty good bet that, over the long term, gold should perform well for you in the future. The question is, however, exactly how much gold should you have in your portfolio? Taking into account that the market is constantly subject to changes, calculating exactly how much you should hold is not an exact science.  However, as a general rule, you should look to allocate at least 5% of your investment portfolio in gold.  Some experts go so far to say that 5 – 10% is the optimum. But you should bear in mind that gold is a long-term investment and is mainly for the protection of your family’s other assets.  It is generally not considered as a short-term investment for quick capital gains.   Also remember that the more you purchase, the more you will be paying in storage fees over the time that you hold it – if storage is required.  

Buying physical gold

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If you are genuinely thinking about gold as a potential purchase, you need to know where to start looking for this precious metal. The first thing you should do is decide whether you want bars or coins. It must be noted that coins carry unique advantages. In particular, some gold coins can be extremely rare, which is the main reason they have a higher cost attached to them. Not only are they more collectible, but they are very ‘liquid’.  If you find yourself in a crisis situation, it is much easier for you to trade them in. Gold bars, on the other hand, are less liquid, as they are less divisible.  The larger the bar, the greater the value of that bar is. But they do provide less flexibility.

The second thing you will need to consider is the cost. It is prudent to understand that dealers will not sell lower than the market price. Although you should shop around for a good price, don’t expect the difference in price to be that big. And when selecting a dealer, you should check his reputation and that the company you are considering has a good understanding of the market. A good dealer will have the precious, yellow metal delivered direct to your doorstep, using reputable and trusted carriers.  

Ways of diversifying your portfolio with gold

There are many ways you can choose to diversify your portfolio with a precious metal such as gold.  But by far the most popular is to purchase gold coins. You can acquire as little or as many coins as you wish and there is the option of keeping them at home in a secure place, if that’s what you choose to do.  There are many safe places around your home, which can be used for hiding your coins.  This means you don’t have to pay the additional cost of storage through the dealer.

Another popular option for purchasing gold is to acquire it through your pension. Under certain circumstances, the UK government is willing to pay some of the cost, provided that you opt for investment grade gold, in a self-invested personal pension.

There are many choices to make when considering your family’s future, and you have to think about protecting your family’s wealth and make wise decisions.  You may wish to enlist the help of a financial professional to help you make the best decisions.  The main advantage of considering gold is that it is suitable for any budget, can easily be purchased and adding it to you family’s portfolio provides protection and balance to all your other investments.   

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