Should you buy gold if the price is high?

Between rising interest rates and fear a Possible recession – not to mention persistent inflation – gold price going well

In early April, spot gold prices rose above $2,000, skating near an all-time high set for 2020 at the peak of the pandemic. After a few weeks ups and downsGold prices continued to rise the next day The Fed’s latest rate hike announced earlier this month. Although the price of gold is high today, Some experts believe They may still have a way to go before reaching a new peak.

But consider what high gold prices mean for investors Adding gold to their portfolio? Here’s what to know about buying when gold prices rise.

Learn more about your gold investment options today with a free information kit.

Should you buy gold if the price rises?

One of the Advantages of investing in gold It makes a smart addition to your portfolio in any economic climate. Gold is often seen as a Hedge against inflation, as it provides stability against the value of the dollar. When inflation drives down the value of the dollar, the price of gold often remains stable.

But common investment advice will tell you that the best time to buy an asset is when its price drops. So what makes gold useful even when it is more expensive?

For one, gold investors generally don’t see it as a source of growth. Gold a Great diversifier For your portfolio because it stays stable when other markets fall. Take last year, for example. While the S&P 500 has been in negative territory for the year, gold has risen — not by a large margin, but overall.

Gold may not offer the same long-term gains as traditional investments, but it can help offset periods of recession, so you can absorb losses. That’s why investing in any environment – whether the current gold price is up or down – depends on your ultimate goal.

“A small allocation to gold and other precious metals can provide some good diversification benefits because it doesn’t always align with a traditional stock/bond portfolio,” said Tyler Gray, CFP, managing director at Sagewalk Financial. “Whether it’s the right move for any particular client will come down to their goals, values ​​and investment philosophy.”

Learn more about investing in gold with a free investor kit.

How do you invest in gold?

There are many ways to invest in gold today.

You may be most familiar with physical gold, in the form of gold bars or coins. However, this can be one of the most expensive methods, as it requires you to store it. Other popular gold investment options are similar to stock investments. Gold IRA A regular IRA can provide the same retirement benefits, although you’ll need to work with a custodian to make sure your investments comply with IRS regulations. Gold ETF Another option. They usually either track the price of gold or invest in gold mining companies, so either way you don’t have to worry about storing any physical bullion.

If you are thinking of investing in gold, make sure that the amount you choose fits your overall long-term investment plan. Many experts recommend No more than 5% to 10% should be invested in alternative assets like gold, so you can let the rest of your portfolio benefit from the potential long-term gains stocks and bonds offer. If you’re unsure, you may want to talk to a trusted financial professional about your options.

Start exploring the right gold investment options for your portfolio today with a free investment guide.

Bottom line

Gold prices are rising, I mean Now might be a good time To add precious metals to your investment plan. At the same time, one thing that makes gold unique is its ongoing value regardless of the economic climate or price fluctuations.

If you are looking for a way to hedge against today’s high inflation rate or Guard your portfolio Against an impending recession, keeping a portion of your money in gold can be a good option. In the long run, having that stability can help you weather whatever future market changes may bring.