Gold is one of the most respected metals in the investor community. People have been investing in gold for centuries. The first gold coin appeared in 800 BC, and 300 years later, pure gold coins appeared on the scene. Click here to know more interesting facts about gold.
Benefits of Gold Bullion in your Investment Portfolio
To make things easy for you, we have discussed the benefits of holding gold bullion in your investment portfolio.
1. Beat Inflation
One of the primary reasons for people investing in gold bullion is its ability to beat inflation. Gold has been able to maintain a good record as a safe investment vehicle. Inflation reduces the spending power of the dollar. Still, gold can beat inflation and prevent loss against loss of face value.
If you look at the pricing trends, gold prices move in the opposite direction of the dollar. If the dollar weakens, gold prices are bound to rise. Even if gold prices are not moving upwards at a higher rate, the gold prices are pretty reasonable that will help beat inflation.
2. It Is Equivalent to Money
Though gold is not used as a currency, it still holds good monetary value. It has a longer history than any modern currency. Gold also has long-term store value, which has been stable or moved upwards since the times are known. The price of gold fluctuated, but it has remained priceless over a long period.
All modern currencies that exist today would lose value over time. Suppose you have a 20-year-old 10 dollar note. In that case, there is a possibility it does not hold any value today because the bank does not accept old currency design.
Though such instances are rare, such a situation cannot be completely ruled out. Such a thing does not happen with gold. Click here to know how other currencies have depreciated in comparison to gold.
If you have old gold bullion, it will still command a market price equivalent to its weight and purity.
3. It Is a Tangible Asset
Gold bullion is something you can hold in your hand. It cannot be said with other forms of investment. Modern paper currencies are destroyed by water, fire, and even time. Gold is indestructible, and fires and water do not diminish its value. Unlike other investments, gold does not need any maintenance, feeding, or any particular care. Just buy and store it safely.
4. It Does Not Have Any Counterparty Risk
Gold bullion is a safe investment, as there is no counterparty risk. In simple words, there is no paper contract or financial agreement needed to determine its value. Also, there are no middlemen required to uphold its value. The gold bullion is a complete investment in itself, and it is not any other entity’s liability.
Gold bullion makes your investment portfolio strong because gold prices have never touched zero in the last 3000+ long history. If you look at the increasing price trend of gold, there are negligible chances such a thing will happen in the future.
5. It is Private and Confidential
Gold bullion investments can be private and confidential. If you want, no one will know you have purchased gold bullions. There is no other investment that provides such benefits.
These are some of the benefits of holding gold bullion in your investment portfolio.