Gold is respected throughout the world for its value and rich history, which has been interwoven into a great many cultures for millennia. Coins containing gold appeared around 800 B.C., and the first pure gold coins were struck during the reign of King Croesus of Lydia about 300 years later. Throughout the centuries, people have continued to hold gold for various reasons. Throughout history there has always been a strong demand for gold and silver, and these commodities have a long documented role as money.It comes as no surprise, therefore, that gold is so closely tied to investment securities and every smart investor has some precious metals tied up in their portfolio.
One reason that so many investors trust in gold is because it is considered to be negatively correlated against traditional portfolios. Case in point, the recent financial crisis of 2008 saw stocks and bonds fall in value and alternate assets like hedge funds and real estate fall with them. Through this time gold helped portfolios carry returns through the downturn as it gained an average of 32% per year through 2008 to 2013. It’s no surprise, then, that individual investors as well as world banks recognize gold and silver as popular inflation hedges, as they tend to retain or increase their value during inflationary periods, and long-term inflation in general.
Apart from financial experts, academic economists are also beginning to see the rising value of gold and silver. The Oxford school of Economics recently conducted a study on the relationship between precious metal investment and inflation and found the following to be true:
- Since 2007 the world has seen a period of considerable economic and financial volatility, during which gold has performed strongly with its price more than doubling. This performance has prompted some reappraisal of gold’s properties as an investment vehicle.
- Over the very long-term gold tends to hold its value in real terms, and is proven to withstand financial stress, political turmoil, real interest rates, inflation, central bank activity and the rise and fall of the US dollar exchange rate.
- Conflicts in Syria, Iran and North Korea have made world finance less stable. Entire nations have come to identify with assets such as gold and silver, and their central banks change policy to acquire as much as they can.
According to experts, including the business management consultants at Canada’s Guildhall Wealth Management, you can invest in precious metals without making a large commitment, thanks to the rising value of silver. Silver is considered by many experts to be affordable and undervalued because, like gold, it has no counter-party risk. It is not someone else’s liability. Because silver is not just a monetary metal, but an industrial metal as well, its industrial uses promise its continued value.
Wealth management companies like Guildhall Wealth Management assists clients by helping them protect their wealth and create long-term prosperity by buying and holding gold, silver and diamonds. By trusting a company that has been in business for almost two decades, you can be assured that your assets are protected. Guildhall has worked with clients since 2002, helping them with the direct purchase of precious metals online as well as providing secure depository storage accounts. As an investor, you owe it to yourself to consider expanding your portfolio to include precious metals if you plan to weather the storm. Visit Guildhallwealth.com/what-we-offer/gold-silver-rrsp-tfsa-investment/ to learn more about your investment options. Your portfolio will thank you.