Gold is the world’s premier safe-haven asset. It is the one commodity that everybody flocks to when equities sour. It shines brightest when geopolitical uncertainty and economic turbulence is most volatile. For many investors, gold is an indispensable component of their financial portfolio. In fact, financial analysts are of the opinion that up to 20% accommodation should be made for gold. The problem with the financial markets is that stocks go up and down with little or no prior warning. Economic analysis typically acts as a barometer of likely movement, but the stock market itself is as volatile and unpredictable as the variables that constitute it. The reason for this is simple: stock markets are a gamble.
Gold Meets the International Standard
The factors that affect gold are national and international in nature, and sometimes they are caused by acts of God. Investing is a long-term strategy that is geared towards generating returns in excess of the original investment.
Naturally, the real-money returns must be greater than the nominal value thereof. What’s great about gold is that it is one of those commodities that is limited in quantity. There is only so much gold in the world, and the more we consume the rarer it becomes. Gold has multiple applications in everyday life from jewellery to electronics, store of value and the like. While gold stocks are volatile and typically tank over the long-term, physical gold is a valuable addition to your portfolio.
How has gold performed over time?
Gold is inversely correlated with the strength of the USD. As the dollar rises, the price of gold becomes relatively more expensive to foreign buyers. This decreases the demand for gold bullion and eventually adds downward pressure to the price of the metal. In much the same way, interest rates are inversely correlated with gold. When rates rise in the US, the dollar strengthens and the demand for gold declines. The analogy between owning insurance policies that pay out fixed amounts with fixed premiums and owning gold is all too common. If gold doesn’t appreciate, and retains its store of value status, that is sufficient to hold onto it.
Over the past 16 years, gold has performed solidly. It has gained 390.89% or $1037.80 per ounce. Over the past 5 years, gold has declined by 27.23%, owing to the bullish performance of Wall Street indices. Over the past 1 year, gold has been exceptionally bullish with gains of 19.80%, or $215.40 per ounce. As we narrow the timeframe to 6 months, gold has appreciated by 2.98% – approximately on par with the S&P 500 index, with gains of $37.70 per ounce.
Over the past month, gold has appreciated by 3.64%, or $45.80 per ounce. Currently, the gold price is $1,276.09 per ounce, down 0.17% or $2.21. Gold shines when markets are in turmoil. We saw a spike in the price of gold in the lead up to the Brexit referendum on Thursday, June 23, 2016. Likewise, demand for gold rose as Donald Trump’s poll numbers started to increase with the Hillary Clinton email saga. The political and economic fortunes of global superpowers have a direct impact on the price of precious metals like gold bullion. The percentage annual change in the gold price in US dollars in 2016 is 22.9% for the year-to-date. This is the first year since 2012 that gold has generated a positive annual percentage change. Since 2001 however, the cumulative total return on gold is 380.7%.
Investing in Gold Now
There is no better time than now to add gold, this indispensable component, to your 401k or IRA. At Fortress Gold Group we provide our clients with the ability to have this safe-haven within their IRA or retirement account. It works just like a traditional IRA, except it puts you in control so you get to decide where your money is stored. Most Gold IRA plans require secured storage at a faraway depository. The problem with this arrangement is that if a real emergency does happen, you can’t access your gold.
To learn more, CLICK HERE NOW for a FREE guide or contact the experts at Fortress Gold Group at 800-777-6177 for more information today.