Financial experts advise investors to keep an appropriate amount of gold in their portfolios, especially in times of crisis. This is not only due to its long-term stability of value and flexibility but also to numerous other advantages. If you want to fully benefit from the advantages of the investment firm, you have to consider a few things when buying. Here is an overview of the essential tips.
How Much Gold Should You Have In Your Portfolio?
Even if gold is a very safe investment and reliable protection against inflation, it should only make up part of the portfolio like all other investment classes. Financial experts recommend 10 to 25% of total assets. The decisive factor is your risk profile. For those who focus on the safety aspect of the system, it approaches 25%. During times of economic upheaval or crises, a higher proportion can be advisable. An individual investment strategy should be developed in advance with an expert such as GLOBAL GOLD AG.
The Right Time To Buy
A second important aspect of buying gold is timing. A look at the London Bullion Market Association (LBMA) website shows that the price of gold is subject to fluctuations, which is why investors are interested in not overpaying for their precious metals. In this context, experts recommend making use of the cost-average effect. It says that the most effective way to invest is to buy gold for smaller amounts regularly.
If the price is higher, you pay more. If it is lower, you pay less. In this way, the prices align in the long term to pay a stable average price overall and do not waste time waiting for the supposedly lowest entry price.
The Optimal Denomination
Anyone who invests in gold can choose between different forms. Bars and coins are the most common. An overview of the most important differences.
The bars available in a wide variety of sizes and weight classes are the most popular among investors. Minibars weighing just 0.5 g are available, as are medium-sized versions weighing 250 g and heavy bars weighing 1 kg and more.
A significant advantage of bars is that they are easier to manufacture than coins. Since labor-intensive steps such as embossing are eliminated, the investor buys at a lower price. One disadvantage, however, is that bars cannot be sold as quickly as coins. If you only want to liquidate part of your portfolio, you have to separate the gold first, which is associated with costs.
Also Read : Multichannel – An Essential Trend In E-Commerce
Coins convince with their easy divisibility. If there is a short-term need for liquidity, individual coins can be quickly sold. In addition, some coins can achieve collector status, which opens up new opportunities for returns. The disadvantage is the slightly higher price due to the additional work step of embossing. It is best to choose globally recognized collector coins such as the Krugerrand, Maple Leaf, and American Eagle when it comes to coins. Here you get a reliable certification about the authenticity of the coins.
A combination of both types of investment is generally recommended. On the one hand, you benefit from the greater flexibility of the coins, but on the other hand, you also benefit from the lower price of the bars.