Gold as Investment
Gold is respected throughout the world for its value for many centuries. Coins containing gold appeared around 650 B.C., and the first pure gold coins were struck during the reign of King Croesus of Lydia about 100 years later.
Throughout the years, people have continued to hold gold for various reasons - like money for exchange, as valuable jewellery, and even as a form of investment. Below are some reasons to think about why you should buy gold today.
Easy to buy and sell
First of all, physical gold is really easy to buy and sell. There are multiple jewellery stores and pawn shops in almost every area. It has become even more accessible now with online stores on various platforms such as Shopee and Lazada. However, an important word of advice is to buy only from reputable stores that are able to prove the authenticity and originality of the gold.
Does not require high maintenance
One advantage of investing in gold is that there is not much maintenance needed. Even if the gold is in the form of jewellery that you frequently wear, real gold is very durable and will not get damaged easily. Unlike some other investments such as properties or stocks, maintenance and monitoring are required to ensure that they keep the value. This effort and time might be hard for some to keep up with.
Demand for Gold has been constantly increasing
Ease of buying, selling, and maintaining is an advantage but not the main issue when it comes to investments. After all, if there is no value to an item, nobody would care to buy or maintain them. It has been shown that gold has always kept its value throughout the years. This has led to the demand for gold growing among investors. This is further fueled by the relative scarcity of gold and the difficulty of extraction.
Gold Prices has been constantly rising
Gold prices tend to rise when the cost of living increases. Throughout history, investors have seen gold prices soar and the stock market plunge during high inflation. This is because when fiat currency loses its purchasing power to inflation, gold tends to be priced in those currency units and thus tends to rise along with everything else. This means that the gold you hold now has a likely chance to appreciate in years to come.
Price Stability/ Protect against Inflation and Deflation
Also because of gold prices rising during inflation, it is an excellent hedge against inflation when you hold gold. On the other hand, while gold may protect you against Inflation, it can also protect you against deflation! Deflation is defined as a period in which prices decrease when business activity slows and the economy is burdened by excessive debt.
The last Great Depression in the 1930s saw the relative purchasing power of gold soar while other prices dropped sharply. This is because people chose to hoard cash, and the safest place to hold cash was in gold and gold coins at the time.
Beautiful, Durable, and Lasting
When it comes to owning physical gold, it is most common to hold them in jewellery, coins, or bars form. All these physical forms of gold are durable and lasting. Gold jewellery is also very commonly favoured despite the additional workmanship costs, because of its beautiful aesthetics and practical uses where it can be incorporated into an important event outfit or even worn daily to feel and look good.
On a final note, physical gold is not the only way to invest and you should do your research to find a good investment diversification to suit your wants and needs.