With all their good intentions, people will lead you to believe that investing in gold is a mistake. This is a misnomer. Much of what you may hear about is no more than simple myths put forth by the uninformed.
Debunking the Myths
- Too Risky – The gold market is unpredictable; the ups and downs of the market are too great a risk to invest in. Fact: The stock market is more volatile than the gold market.
- No Dividend or Interest Payment – It is true, you will not profit from interest or dividends when it comes to gold bullion investments. If that is what you’re looking for, then a relatively safe form of investing, such as certificate of deposits, is the investment method for you. It is low risk and with low returns; however, the fact of the matter is that as gold sits idle in a vault somewhere, it appreciates. Gold can yield more revenue than the interest and dividends other investments bring. Therefore, gold is the better, more valuable commodity to invest in.
- Gold is not a good inflation hedge – This is a belief held by many. Investors strive to invest in what will protect them against a devalued economy. Gold, with its instability, is thought to be a risk with no protection. Fact: Gold does maintain its value, its purchasing power, and comparing it with all major currencies, it has maintained and even increased in value over the years. Gold is actually a good inflation hedge, a safe haven.
- Investing in mining stocks is better than gold bullions – It is true that mining stocks can yield an impressive return but investing in mining stock is much more volatile than that of an investment in gold. Fact: Gold Bullion holds its value and overall out performs profitable margins of mining stocks.
- It’s antiquated – There are those who believe investing in gold is a thing of the past and that gold has no monetary role in today’s economy. That is farthest from the truth. Fact: Gold is very much a part of our monetary system still today. World banks still hold gold in their reserves and upon trading, it does not take place at the commodity desk of banks and brokers, but at the currency desk.
Invest in Gold
All investments have with their own ups and downs and typically every form of investing is a speculation and comes with a risk. Gold is no different. However, gold, now as in years past, maintains a long term value.
Even in an unstable economy, gold remains a profitable investment. There are many ways to invest in gold. You can start out small with American Eagle Bullion Coins or if you’re a bit more ambitious invest in gold bullion bars. When you are ready to invest, you can buy gold from Scottsdale Bullion and Coin or from other reputable dealers such as that one.
People will say the darnedest things, often misleading their listeners with inaccurate information, persuading you into Investments that may not be as low a risk as believed. So, before you dismiss the idea of investing in gold, learn the truths. Investing in gold is a wise investment.
About the Author: Randy Schmitdt is a freelance writer and researcher from New Hampshire.