Wealth Management

How To Invest In Gold Like The Wealthy

Gold has been a much-favored investment since ancient times. Today, many investors spare a certain portion of their resources for buying and selling gold. Because, of course, it pays off in the long run. Gold attracts such credibility because it shows high resistance to political and inflationary changes. Your investment is pretty much secured.
But there are ways to invest in gold. High net worth individuals (HNWIs) know the tricks and have shared them with the world time and again. I’ll give you an update on some of those tricks. Over here, a small guide is given to invest in gold like the wealthy. Let’s take a look.

  1. Identify the investment opportunities
    Multiple opportunities to invest in gold exist. You need to identify which one suits you the best. To name a few, you can invest in popular options such as bullion, futures, mutual funds, jewelry, and gold Exchange-Traded Funds (ETF). HNWIs also invest in gold mining companies, often carrying relatively low risk.
  2. Research which opportunity meets your goals
    Once you’ve identified these opportunities, you need to do detailed research. You’ll have to look at what these opportunities generate, how much time an investment needs to sustain, and what kind of goals you have.
    For example, HNWIs are large investors who usually invest directly in gold bullion because it offers direct exposure. Of course, this comes with its own riders in the form of storage costs and premiums. Unless you have that kind of resource at your disposal, you should avoid such cost-intensive endeavors in the first go.
    On the other hand, ETFs and mutual funds are preferable for those with low-risk appetites. However, these funds also come with add-on costs in terms of expense ratios. You can invest in jewelry, but it yields low profits.
  3. Should you be investing during economic downturns
    It depends. But, historically speaking, gold has shown to act as a solid choice during economic downturns. It is a type of asset with less correlation with other investment assets. That being said, the kind of benefits you’ll accrue from gold investment during a recession cannot be predetermined. Much will rely on your investment strategy. But, in general, gold investment in such circumstances is not a bad bet.
  4. Portfolio diversification
    This brings us to the question of portfolio diversification. You should understand why experts ask investors to diversify their portfolios. There is no way to predict how the market will perform. It can skyrocket or freefall even after having done meticulous research and analyses. Portfolio diversification, thus, protects you from extreme losses.
    Just like you need to diversify stocks by purchasing multi-sectoral shares or investing in mutual funds doing the same, you should add gold to your portfolio. As noted above, gold acts as a buffer asset at times. It may not yield high profits during an economic slump, but it can cushion you from potentially unbearable losses. HNWIs know that very well, so they keep their hands on gold all the time, especially in times of crisis.
  5. Long-term is advised
    Research shows that long-term investments have shown better results. Gold is a highly resistant asset, but it takes time to yield profitable results. In its past 3000+ years of history, its value has never plummeted to zero and has only significantly improved overall. You can say that it is a safe investment but should be kept in the portfolio for a longer duration. And, in case you are in dire need of currency, you can very easily sell this tangible asset; it is a highly liquid asset, after all.

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Ayushi Kushwaha
Ayushi Kushwaha, Staff Writer for the CEOWORLD magazine. She’s spent more than a decade working for various magazines, newspapers, and digital publications and is now a Staff Writer at The CEOWORLD magazine. She writes news stories and executive profiles for the magazine’s print and online editions. Obsessed with unlocking high-impact choices to accelerate meaningful progress, she helps individuals and organizations stand out and get noticed. She can be reached on email ayushi-kushwaha@ceoworld.biz.