Discover the Advantages of a Gold IRA
Henry Clibborn- A gold futures contract is an agreement to buy or sell gold, usually in troy ounces.
- Gold futures are traded on the COMEX division of the New York Mercantile Exchange. The gold market can be volatile, and it's affected by a number of economic factors.
- Gold is a precious metal with many applications.
Gold is classified as a precious metal, so it has a certain appeal to investors. Because of its value, it also makes a good hedge against the volatility of the stock market and the U.S. dollar. It's often said that gold is money.
Gold is classified as a precious metal, so it has a use in jewelry, art, dentistry, electronics, and more. Gold mining is a large-scale industry that has come a long way from the days when prospectors used pans and shovels in the search for gold.
Gold's History
Gold has been traded for millennia, and it's still considered the only currency that is intrinsically valuable. Its supply is limited, and it cannot be printed on a whim.
Gold's Value
Gold is a store of value. It's considered a safe haven asset, and its value tends to rise during inflationary and financial crisis periods.
Gold's Deflation Protection
Gold tends to perform well during periods of deflation, as deflation tends to reduce the purchasing power of fiat currencies.
Gold's Diversification
Gold's price varies widely, and its performance tends to vary independently from the performance of stocks and bonds.
Gold's Advantages
Gold has several advantages over stocks, bonds, and other assets. First, gold is a tangible asset. You can hold it in your hand or keep it in a bank safe. You cannot do that with stocks or bonds.
Gold is also finite. There is only so much gold in the world. That limits the amount of gold that can be created.
Gold's Disadvantages
Since the price of gold varies, investors are always concerned about how much they are paying relative to what they will receive in return. For example, since the price of gold fluctuates frequently, investors are constantly checking its value against other currencies, such as the U.S. dollar.
Gold's Daily Price Volatility
Gold is a commodity that is highly volatile on a daily basis. For example, gold prices can fluctuate from $1,200 to $1,225 in a single day. In 2019, it reached a high of $1,290. Conversely, it reached a low of $1,068, or over 25% lower than its previous high.
Gold IRA: Should You Open One To Save For Retirement?
The Bottom Line
If you're worried about your retirement savings, a gold IRA may be your ticket to a secure retirement. Gold has been a go-to investment option for many investors throughout history because of its inherent value, portability, and ease to store or transfer.
