With so many uses for rare metals such as gold, silver and platinum, these commodities have withstood the test of time as savvy investments. While the market can fluctuate, the value of precious metals tends to increase over the long term, offering excellent price appreciation and potential for profit. Notorious billionaire investors buy precious metals on a regular basis, but especially this year with the many political and economic factors affecting confidence in the marketplace.
Below are just five of the many important reasons to buy precious metals.
1. Precious metals are tangible commodities that hold their intrinsic value. It’s hard to go wrong by investing in something that will always be in demand.
2. Investing in commodities such as precious metals balances your portfolio. If the value of the dollar decreases, part of your portfolio will still retain its value. Inflation causes worry among investors that is clearly reflected in the value of currency and even government-issued bonds.
3. Buying precious metals is a hedge against equities. In a volatile marketplace, rare metals such as silver and gold are a safe haven for investment.
4. An election year can cause serious upheaval in the stock market. Again, precious metals are your safest bet in a year like this—as shown by the surge in both gold and silver prices so far in 2016.
5. Buying precious metals is an excellent way to hedge your portfolios, especially in a worst case scenario—if the global economy hits rock bottom, there’s a possibility trading will take place in commodities. Throughout history, rare earth metals have proven to be a solid bet during times of political strife, war and economic instability—and collapsed economies often resorted to barter. While such an apocalyptic scenario for present day is doubtful, incidents of terrorism do not seem to be slowing down and can disrupt the financial markets. Some opt for the better safe than sorry approach and treat precious metal investment as a form of “wealth insurance.”
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