Can you make money by investing in gold?

Another year is in the books, and many Americans are starting 2023 by reviewing their finances and reevaluating their investments. Amidst stock market volatility, international turmoil, and a potential recession, some investors are turning to gold as a safe haven for their investments.

Historically, a common investment strategy has been to treat gold as a store of value during volatile times. But can you make money by investing in gold? Investors generally Invest in gold To help diversify and stabilize their portfolios, it is possible to make money by investing in gold.

If you think you could benefit from investing in gold, get started by requesting a free wealth protection kit to learn more about this unique opportunity.

How you can make money investing in gold

One of the easy ways Invest in gold Buy gold bars and coins, which may increase in value due to inflation or global volatility. During the financial crisis of the late 2000s, a surge in gold investment saw gold prices rise from $800 per ounce in 2009 to $1,900 in 2011. Financial Post.

Similarly, gold investment increased during the pandemic, with gold prices moving from an average price of $1,393.34 in 2019 to an average of $1,798.89 in 2021. Macro trends.

If you don’t want to deal with the hassle of storing physical gold, you can choose to own gold stocks, whose prices fluctuate with the price of gold. Like companies in other sectors, regardless of industry trends, some gold mining companies are well-run and profitable even when gold prices fall. In addition, small rises in gold prices can lead to significant gains with some gold stocks, providing higher returns on investment for their shareholders than actual gold owners experience.

Gold exchange-traded funds (ETFs), collections of gold mining stocks, are another option to potentially profit from gold. Many investors prefer ETFs over individual gold stocks to spread their investment risk.

Of course, investing in gold stocks and ETFs exposes you to the same fluctuations as the stock market. That means your investment could go down during a stock market crash, even if gold prices remain unchanged.

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How you can make money investing in gold

Like other assets, gold investments carry the potential for price declines, so it’s important to understand the risks before investing your money. One way to reduce the chance of loss is to avoid risky investments. For example, some experts warn against buying:

• Proof currency: These are special edition coins designed for collectors that are the highest quality coins produced by the United States Mint states. These coins may be overpriced due to collector demand, and their gold value may disappear depending on market conditions. Buy standard gold Coins from a reputable dealer can be a safe bet.
• Fractional currency: As the name suggests, fractional coins are available in fractions of an ounce, such as half-ounces or quarter-ounces. While these coins are an affordable way for many to invest in gold, they carry a higher markup than one-ounce coins, ranging from nine to 15%.
• Gold Futures and Options: Futures and options contracts represent the riskiest form of gold investment. These speculative investment options have the potential for both high rewards and catastrophic losses. Because the risk is so significant, many online brokerages require you to sign additional forms acknowledging the potential dangers these derivatives present.

Other considerations

It is possible to make money from it though Gold investment, proponents of the yellow metal generally see it as a tool for resource conservation rather than growth. Traditionally, the stock market provides higher returns than gold. From 1990 to 2020, the price of gold increased by about 462%, from an average of $383.73 to $1,773.73. Macro trends. During the same 30-year period, Dow Jones Industrial Average (DJIA) From an average price of $2,679.45 in 1990 to $26,890.67 in 2020, an increase of about 1003%.

In the short term, gold can outperform the stock market as investors react to inflation, global turmoil and other factors that drive investors to gold. But over the long haul, the stock market provides a considerably higher ROI. As such, it may be best to view gold as a safe haven and means Your portfolio is diversified.

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Bottom line

It is possible to make money with gold, although preserving wealth may be a more appropriate goal. As with any investment, weight Pros and cons of buying gold And how gold can help you achieve your financial goals. For example, senior citizens looking for an income-producing asset may find a better option than gold. However, if you are looking for a Hedge against inflation, may mean investing in gold. You can start reviewing your gold investment options by reviewing the companies in the table below