Golden Opportunities: Introducing The Ultimate Guide to Investing in Gold in?2024
In this article we are going to talk about gold, this investment alternative that is used in some strategies, such as the permanent portfolio or there are people who want to have a small part of their portfolio invested in gold since it usually performs well in the long run. term and has historically been used to protect against inflation since gold has revalued at a higher rate and it is important to protect ourselves against a continuous cycle of inflation logically because it affects our purchasing power and our money, because if we leave it in Fiat currency then we will be able to buy less and less things so This is a perfect tool for this purpose . We are also going to see what the returns have been generated by investing in this type of asset in recent years.
Investing in gold, as we mentioned above, is an investment that has proven to be an effective hedge against inflation, this means that its value tends to increase when the prices of other goods and services rise. In addition, gold can also protect us from risks of currency devaluation. Since it maintains an inverse correlation with the Fiat currency, I don't care if we talk about euros or dollars to be able to invest in gold it can be done in several ways, such as buying Physical gold bars can also be invested through ETFS through gold mining stocks for example, there are different ways in which we can have exposure to gold , Each has its advantages and disadvantages but one of the easiest ways to have exposure to gold is through ETFS since you can invest with a cost Very low, around 0.10 percent annual commissions, which is quite good. Another simple and simple way is to own physical gold. It is the favorite of people who do not trust banks or brokers and want to have gold bullion. gold for example in your house in a safe
Each method of investing in gold has its pros and cons. Analyzing ETFS in particular, they have not done badly historically.
If we observe over the last 20 years they have had a profitability of 494 percent, if we measure it with the Euro currency, if we measure it in Dollars, the revaluation would have been similar, around 426 percent, so a person who had invested in gold over the last 20 years because not only would it have managed to maintain its purchasing power but it would also have generated real wealth above? of inflation?
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Something interesting that has to do with investment in gold is that it has a certain relationship with the cycles of increases and decreases in interest rates. We can see in the different graphs when the United States Fed stops raising interest rates and These start to go down normally, gold performs well , For example, between 2000 and 2004, Gold revalued while rates fell by 66%. Later in 2007, interest rates peaked and then they began to fall. Well, gold rose by 189% in the following years, more forward in the year 2019 2020 Well, it also had an important Rally of 50% and right now we are again at that moment in which we have already reached the ceiling of interest rates and these are going to begin to decrease in the coming months so it is It is likely that gold will perform well in the coming months and in the coming years, which is why it becomes interesting to have a small part of the portfolio exposed to gold.
As you can see, Gold is an alternative that has historically protected us against inflation. It is true that there are other alternatives, such as Bonds or Shares that have also proven to protect against inflation and have generated real wealth in the long term, but gold is the haven of value par excellence
And as a great investor once said, it is the easiest and safest way to invest, you can accumulate Gold at home, as we have mentioned before, investing through the stock market with exposure to Mining Companies or with Gold Royalties, in ETFS it is already a decision Each person's personal choice is to choose the way that best suits their investment style.