Author:
• Tuesday, March 11th, 2014

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In this economy, every investor wants to do their part to protect their assets. Stocks are volatile and these days you never know what will happen next with the dollar. As someone who is making purchases with the future in mind, you don’t want to be riding the unpredictable waves of the market. You don’t want to be calculating based on estimates if you can help it. This is your retirement and your finances at stake here. What if you could invest in an item that was the closest to a sure thing out there? What if there was a way to take some of the guesswork out of your investments? Believe it or not, precious metals like gold and silver give you an opportunity to do exactly that. Here’s a quick rundown of what it all entails.

Why Gold or Silver?

A lot of people will talk about the valuable metals but they won’t always elaborate on the reasons why it’s important. What’s the hype all about and what are the benefits exactly? This is what you need to know.

gold and silver bars

1. Protect Your Savings

As has been touched on already, the stock market has its ups and downs. One day it can be skyrocketing and the next day the value of your investment can take quite the tumble. You see, we often talk about the fortunes being made on the market but we don’t often discuss the fortunes that get lost. If you don’t want to be “trying your luck” with your savings on the line, a precious metal offers you more stability.

2. Recession-Proof Your Accounts

While there’s no question that the market can be a juggernaut, there are also times when purchasing power is out of your control. You just never know when the government will mess something up or when the economy will tank again. With rumblings and rumors springing up out of seemingly nowhere, folks can barely predict the results of the next quarters. Never mind figuring out when and if recessions are going to become the “new economic normal”. Precious metals allow you to stay in the green.

 save money

3. Fund Your Other Investments

The number one problem that investors have to contend with is funding. You might be investing in a company that’s guaranteed to bring solid returns, but the sales cycle spares no one. A precious metal will maintain its value no matter what’s happening with the economy or your job situation. So if you need those profits to get your portfolio through a slow quarter, you can hold on and eventually start realizing the massive returns you’ve been anticipating.

Why Gold?

It’s a recognized precious metal. Part of the problem with some coins is that they’re not always accepted as legal tender. That makes sense though, doesn’t it? A product may be valuable in your country but not in another. Can you imagine attempting to shore up your portfolio only to discover that the value of your new pick-up is in dispute?

Whether you’ve bought a retirement home or you’ve made plans to travel abroad, there’s no question that gold investing is universally recognized as a sound investment.

Here is a review of Regal Assets, one of the industry leaders.

Never Deal With Negative Value

Another reason to be cautious with your investments is the reality that there’s money to be lost on the market. If your stock goes down when you’ve bought low then you could be straight out of luck. If your stock goes up when you’ve sold it short, the potential losses are virtually unlimited. Gold doesn’t have this problem. It’s been traded for thousands of years and you can rest easy knowing that it’ll always have value.

gold coins and stocks

What About Silver?

Do you like the security of a precious metal but want to diversify a little bit where your investments are concerned? After all, you don’t necessarily want to your entire portfolio to be tied up in gold. You want to spread out your investments in order to increase your profits. Silver has long been recognized as a valuable item as well. Next to gold, this is hands down one of the most popular metals out there. Put simply, this is another precious metal with a solid reputation around the world. That alone makes silver a feasible second option for investors who want to top off their portfolios with a little more stability.

At the end of the day, investing is about strategy. If you’re not interested in the upkeep and hassle of regular stocks, precious metals give you another choice. Gold and silver are known around the world for their value. Why not use their stability to your advantage?

Author:
• Sunday, January 26th, 2014

Quite a number of people meticulously follow the prices of gold and silver. The vacillations in the prices of both commodities have been critical and difficult to forecast on a short scale. Over the course of protracted periods, both commodities have been on a continual upward trend.

There are a number of elements have brought about changes in the price of the two commodities. There are a few key drivers for both commodities that can be said to be instrumental in the way the movement of both commodities occurs. These key factors can be categorized in one of the following three ways. There is the price of the US currency, the element of profit taking and the issue of global speculation.

How the Value of the US Currency Affects the Two Commodities

The value of the US currency will without a doubt affect gold price as well as silver price. This is because precious metals are priced through the US dollar and if there is a waning in the value of the US Dollar Index, both commodities will be more costly. This is because a decrease in the value of the dollar means that buyers of the two leading commodities will need more to make purchases of a constant volume of both commodities. This is the major reason why investors will buy gold when they forecast that the US dollar will probably get devalued.

The Element of Profit Taking

Most people view these two commodities or even other precious commodities as a stable security investment that insures them financially. Others however make investments in precious metals purely for purposes of profit. They use a colossal amount of funds and evaluate the spot prices of the two precious commodities on a very regular basis during trading days. When such an investment which sometimes can be undertaken for over one month goes up about one to five percent, they liquidate and bring about movement in the market.

Household investors also undertake profit taking. In recent years, we have witnessed the price for these two plummets upwards by 10 percent in many instances during just a day of trading. This has the effect of making safety seeking investors that are hungry for profit to get back to cash before the complete cycle of the two commodities has run its course. This is also a blunder that investors make when there is an accelerated decline in the prices subsequent to a considerable span of cycle when there was speedy gains.

Global Speculation as a Factor Affecting the Two Commodities

We are all aware of the fact that the real market of both commodities has a global reach. This means that it is not the US currency alone that affects their prices. This means that when institutions are looking for profit or when household investors get the wrong idea that the cycle for both commodities is complete, there will definitely be price fluctuations.

The European continent plays a major role in the fluctuation of the prices of these two commodities. This is because of financial pressures that the continent is going through. The same can be said of the Middle East turbulence. India and China play a major role in the price fluctuation of precious commodities because they amass and stash up huge quantities of precious metals. The economy of the United States will also continue to play a major role in the way price changes affect commodities both positively and negatively.

Other Factors that Affect Prices

Prices for both precious metals have always had a greater degree of interrelationship and are affected by similar circumstances for example global and market trends. The one major trend that we can expect is that the prices of silver and gold will increase the moment there is uncertainty or when the major economic indicators begin to move towards a negative direction. Anytime there is an extreme risk aversion, you will expect that the prices of both commodities will hardly go up. Between the two, gold as a commodity and silver as a commodity, gold goes down much lesser and less so than any commodity that can spring to mind.

Whenever there is recession and depression in the global economy, you can expect more speculation in gold as well as silver. This is because they happen to be less volatile and more dependable for investors during such economic conditions. Improvements in economies will cause investors to begin to sell their gold and silver. Natural disasters and political events can also bring about an upward change in the price of the two leading commodities.

One other major factor that can affect the prices of the two commodities is the condition of the real estate market. Prices will rise when there is success in this market. The moment that there is a low or negative return in the real estate market, the demand for the two commodities will increase. Investing in both is a prudent move but so is the ability to determine if prices will increase or decrease.

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