Sabtu, 06 April 2013

Should still invest in gold?

Investing in gold. Still a smart move for your portfolio

Wow, another reminder for investing in gold! Debka reports that India will use the gold to buy oil from Iran. India spends about $ 12 billion dollars a year to buy oil from Iran. China is expected to use gold as a currency to buy oil from Iran as well.

So what does this mean? India and China have completely lost faith in the dollar and the euro. India and China are growing faster than the United States and are the engines of this new global economy. Have more influence in the global economy, than they did just a few years ago.

As Bob Dylan would say, “times are a changing”. You should invest in gold to your investment portfolio, and if you already own gold, you can discuss this with your financial advisor. Most financial advisers recommend an allocation between 5-15% of gold. An easy way to invest in gold is to purchase it through a fund traded mistaken. Go here for more details.

What are the reasons to invest in gold? (or buy more)

Is that the dollar will continue to devalue.
You are concerned about the United States printing money to exit the recession/slow growth.
You are worried that inflation is going to go back to the big time.
You are worried that Greece will default and that things will get worse in Europe.
Is that there is a possibility that the euro will no longer devalue or just go away. I am also worried that Europeans will print money to get out of its recession.

As I write this, gold is at $ 1,665 per ounce. It has been 10 years in a row. Then, you need to ask yourself how this negative news around the world is already factored in gold stocks? This means that you can buy gold to a high. If you think there are more negative news to follow, you should invest in gold.

Oh and one more thing on the advisability of investing in gold. Historically, gold has not been correlated to stocks. In other words, what happened to stocks had little impact on the price of gold.

Keep in mind that this is the General Council. You need to understand your risk tolerance. Gold should not be the only investment in your portfolio. Gold can go down and you can lose money. I use it as a hedge against other investments.

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