Gold, and WHY BUY
Gold is a symbol of wealth and status that's lasted for centuries, associated with all things luxurious from jewelry to sports cars to even high-end dining, It's one of the most beloved and influential commodities that exist in our market today. Gold is unique in that it's both a commodity and a currency. So some investors will hold it purely as a financial asset and others may hold it in jewelry form so it can be enjoyed also it's a way of storing wealth as well.
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Gold is one of the largest financial assets in the world with a daily trading volume of $183 billion. Gold has seen explosive growth in recent years. At the start of 2000, gold was priced at just $460, when adjusted for inflation by August 2021. The number had ballooned to roughly $1,815 per ounce over the past decade.
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So how valuable is gold as an investment? Gold is an enticing asset for investors. It's been around long enough to feel reliable, durable enough to be stored long-term, and scarce enough to be considered precious. Compared to other precious metals. It has a wider variety of real-world applications that provide a constant demand for metal.
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In 2021, central banks held more than 35,000 metric tons of gold, the fifth of all the gold that's ever been mined. The International Monetary Fund holds about 2,814 metric tons of gold value at around $158.5 billion.
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Advantages of Investing in Gold
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Some of the advantages of investing in gold include:
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1. Possibility of diversification
To reduce the risk of your investments it is important to have a diversified portfolio. In this sense, gold can be an interesting option for investors.
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2. Asset for protection
Generally speaking, gold is considered a type of protection ( hedge ) during times of inflationary crisis. Therefore, it tends to show a high valuation in these types of crises. Since gold is unlikely to suffer devaluations such as those seen in the currency of a particular country, which is going through turbulent times.
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3. Liquidity and recognized value
One of the factors that makes gold a good investment is its liquidity, even internationally. Gold can easily be converted to cash. In summary, compared to other investments, gold is one that offers the greatest liquidity.
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4. Maintenance of value
Gold retains its value over time. Even if the price drops, the inherent value of gold doesn’t change much.
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5. Perpetuity
This metal has no expiration date, that is, due to its chemical characteristics, it never rusts or corrodes over time, like other metals. Therefore, its value does not depreciate.
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