Gold could be much more efficient than cash when it comes to storing wealth. Interest rates remain low, meaning your money in the bank “earns practically nothing,” CNN Money reports. If inflation is taken into account, that cash may have lost value. It is recognized that gold has a history of long-term stability.
For various reasons, the yellow metal retains its intrinsic value better than anything else. Gold is the same everywhere in the world, there is no need to convert it at a price to a local currency. Unlike cash, there is the possibility of making capital gains with gold; historically, gold prices have performed well. Physical gold can be at risk of being stolen, so the owner must ensure that he has solid security.
Sometimes, it may be through third-party storage, which should be carefully investigated to reduce counterparty risk. Although the economy no longer functions based on a “gold standard”, gold is still used as money in many parts of the world and, in fact, central banks continue to hold and buy large quantities of this precious metal. Gold is also internationally recognizable and tradable, making it a de facto foreign currency and a money-saving asset for investors around the world. Physical gold stored by the owner is not subject to fraud and, in general (if we analyze history), as inflation increases, so does the price of gold, which is known as an investment product used to protect against inflation.
Gold bars are durable, meaning they can survive natural disasters and cannot wither for extended periods of time. Physical gold has maintained its purchasing power much better than cash and, as inflation will increase, the disparity between gold and cash will increase. In this scenario, some investors may prefer to hold their assets in alternative investments such as gold, but gold can sometimes be volatile during a turbulent economy. As a physical asset with an established value that is constantly increasing, gold has a number of benefits that make it the investment platform of choice for several individuals and organizations.
Gold is a good diversified portfolio because of its low correlation with conventional assets, such as stocks and bonds. The scarcity and rate of discovery of gold have allowed it to become a universally accepted currency and material asset. Considering the tax advantages of gold returns derived from the tax discount on capital gains compared to the payment of income tax on interest earned annually, the long-term net return differential between gold and cash would be greater. Physical gold is practically indestructible and cannot be devalued by the whims or economic needs of a government.
The gap between the return on cash and the return on gold has widened significantly in recent decades, due to unprecedented low interest rates in Australia and around the world, and which appear to be maintained in the near future. We can advise you on strategies to better convert your paper wealth into physical gold and, in doing so, take advantage of the benefits described above. Gold has truly stood the test of time and has been used as a method of exchange in trading for more than 5000 years. Stay informed If you want to receive up-to-date information on news, investment products, discounts and exclusive services related to 26% silver gold, be sure to check the buttons below.
Definition: The Pure Gold Company will purchase gold up to the nearest integer number of ingots or coins and the monetary difference between the amount of the investment and the actual amount purchased will be reimbursed in full. .