Why you should invest in physical gold

Fsp Invest, 03 Oct. 2013

Tags: physical gold, gold, why you should own physical gold, gold bullion, krugerrands, financial insurance, invest in physical gold

Physical gold should form a part of a properly diversified portfolio. It is not the same as owning gold shares or gold backed exchange traded funds. You should look at physical gold as an insurance policy. Read on to find out why you should invest in physical gold…

Gold remains a universal finite currency, held by every central bank of note in the world, the team of experts at MoneyWeek explain...

After the financial crisis in 2008, central banks became net buyers of gold in 2009 for the first time since 1988.

The Indian Central Bank’s purchase of 200 tonnes of gold from the IMF in October 2009 is the biggest single central bank purchase in such a short period of time (at least known to the markets) for at least 30 years.

In the same way that the family home should not be regarded as an investment, gold bullion is not an investment per se. You should view it as a form of ‘saving for a rainy day’ or of financial insurance.

Once you own physical gold – don’t touch it!

You should take possession of gold or store gold with a secure third party and you should not trade it. You don’t trade an insurance policy. So as a form of financial insurance, you should not trade physical gold.

Gold is money and is the ultimate safe haven asset. It is a great way, if not the best way, of ensuring wealth preservation and for passing wealth from one generation to the next.

Once you achieve the solid base or core holding of gold bullion, such as Krugerrands, in a portfolio then you can consider other investments in gold such as mining stocks, funds and other more speculative gold investments.

So there you have it, why you should invest in physical gold.

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