Planning On Gold Investment? 6 Reasons Why You Should Do So Now!

Ask any smart investor and he will tell you how gold investment is a very lucrative and stable option

. There are many reasons why investors prefer trading in gold.

1.As compared to stocks, gold is cheaper. For example, in 1980, price of gold and Dow Industrials were at 800, the same level. After 24 years, gold is less than half of its 1980 value while Dow is close to 10,000. This shows that there are fantastic gold stock opportunities.

2.The supply of gold is very limited as compared to paper money. While governments can pay off their debts by printing money, they cannot create gold. This makes the metal very precious.

3.Even during international conflicts, price of gold is found to remain relatively stable as compared to other precious metals. During World War I and World War II, price of gold remained stable while price of silver rose by 100 percent. Price of other metals continues to rise through the War on Terrorism while gold price remains steady.

4.In extreme bear markets, gold performs well. During the Great Depression, for example, price of silver doubled whereas gold price was fixed by the government and did not experience any fluctuation.

5.During inflation and deflation, gold stocks have always been on an upward trend. In fact, if you want protection from inflation, it is a good idea investing in gold as gold rises with fall in dollar. Even during deflation, gold stocks will perform well as lowering of interest rates by the government to offset deflation leads to an increase in gold prices.

6.Smart investors always make gold stocks a part of their investment to lower risks. Past experience proves that when stocks perform miserably, gold prices continued to skyrocket. During the 80s and 90s, gold lost half its value when stocks soared. Now, stocks are still below their previous highs while gold prices have soared. Those who held gold stocks have benefited to a great extent as they created a buffer against portfolio fluctuations.

These are some of the prominent reasons why investing in gold is a lucrative opportunity. There are many different ways in which you can invest in gold bars or coins. You can also choose to invest in gold mutual funds, mining stocks and futures and options. Conduct thorough research and choose the best online gold trading company to ensure you enjoy a hassle free experience.

by: Adrian Getty

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