In general, gold is considered a diversifying investment. It is clear that gold has historically served as an investment that can add a diversifying component to your portfolio, regardless of whether you are concerned about inflation, the fall of the US or US dollar, or even the protection of your assets. If your focus is simply diversification, gold is not correlated with stocks, bonds, and real estate. Both silver and gold can function as safe haven assets, but gold tends to have a better track record over long periods of time.
That said, for shorter periods, the specific dynamics of each market end up being more important for their respective returns. Regardless of which one you buy, remember that neither asset produces cash flow, so it is better for investors to take a buying and holding approach with a portfolio of profitable and growing stocks in the long run. The most important thing is that silver prices are cheaper relative to gold than they have been in a long time. Silver bars have a much better potential for capital appreciation, while serving as a hedge against inflation.
Investing in gold is a much more stable option and acts as a solid store of value. Gold prices tend to move at a slower pace. The stability of the spot price of gold adds a level of security for investors. Popular culture often highlights gold as the most desirable metal.
So, you might think that would make it a bigger rarity compared to platinum. But in reality, platinum is about thirty times rarer than gold, according to the World Platinum Investment Council. Each year approximately 190 metric tons of platinum are mined worldwide, compared to 3,300 metric tons of gold. Whether you plan to invest in silver or gold, there are some factors you should seriously consider.
In no particular order, here are five investments that have the positive attributes of gold and fewer drawbacks. Although most ETFs focus on assets such as stocks and bonds, there are many funds that invest in precious metals. One of the most common ways to protect yourself from stock market risk is to invest in precious metals, with the most popular investments of this type being silver and gold. If you don't want to invest physically, you can also buy stocks, ETFs, or mutual funds that invest in gold.
If you want to participate in buying gold, you need to have a significant amount of money to make your initial investment. On the other hand, equities carry a higher volatility risk compared to physical bullion or investments in highly diversified ETFs focused on investing in these assets. Yes, yes, gold prices have had their ups and downs, but in the long run, gold investors were generously rewarded with that quadruple percentage return. But if investing in individual stocks is too risky and time-consuming, you can buy an ETF that owns miners and diversify your stake.
Investors looking for the gold-silver ratio usually do so to get an idea of the relative valuation of silver, and gold is recognized as the most stable asset. Of course, when investing in safer assets, growth is relatively slow compared to stocks and other higher-risk assets, but the upward movement rate is important, nonetheless. Exchange-traded funds, or ETFs, are a popular investment option for those looking to invest in a diversified pool of stocks, but many don't even think about them when investing in assets such as silver and gold. Whether you want exposure to one or the other, a good mix of both, or any of the many other valuable metals out there, you'll be able to find quality mining stocks to invest in.