Debunking the Most Common Gold Investing Myths That Exist Today
When it comes to investing, everyone has their own style and way of doing things. Some investors swear by commodities, while others are looking for the next big stock. Some investors are bullish, while some are bearish.
No matter what your investment style is, there’s a good chance you have come across gold as an investment option. Gold investing has always been a popular option. Yet, through the years there have been a few myths floating around that can have even a smart investor scratching their head.
While investing in gold has a magical allure, it can be helpful to understand facts versus fiction by debunking the most common gold investing myths that exist today.
Gold Prices Increase When Inflation Increases
One of the biggest myths about gold investing as an option is that prices increase when inflation increases. While this is not the case investors tend to buy gold as an inflation hedge.
However, the problem that most investors don’t realize is there is no correlation between the two. Ancillary elements that contribute to the increase in gold prices can also cause inflation to rise at the same time.
For example, from 1980 to 1989, inflation increased by nearly 64 percent, yet gold lost nearly one-third of its value during that decade.
Gold Investing Is Only for the Wealthy
Another myth about gold that is easy to debunk is that gold investing is only for the wealthy. Gold investment doesn’t require a great deal of wealth. Unlike other investment options gold is suitable to all investors no matter your experience or the value of their portfolio.
Gold can also be purchased in small increments, making it easy to acquire no matter your risk aversion level.
Investing in Gold Is Risky
This is a big myth because all investments carry some level of risk. Yet, in downturns gold can act as a hedge when compared to other investment options. When certain geographical regions are experiencing conflict or there is economic uncertainty gold can be a safe investment option.
Gold investing can also prove to be a lucrative investment because its price has never completely flatlined. This alone makes gold a great portfolio diversification option.
You Can Only Invest in Physical Gold or Gold Miners
When it comes to gold investing decisions, many investors make the mistake of just having physical gold or gold ETFs. It should be known that there are other types of gold to invest in.
You can invest in gold miners or streaming companies that provide cash to miners upfront in exchange for future rights to buy precious metals like gold at a reduced rate. Learning how everything you need to know about all the types of gold investments can be done at https://www.cmi-gold-silver.com/buying-gold/.
Gold and Stocks Inadversley Correlate
One last myth about gold investments is that when there if the stock market goes up, the price of gold decreases and vice versa. While there have been some cases where this has been true, overall, there isn’t a direct correlation.
Ready To Invest in Gold?
Portfolio diversification is the key to being a smart investor. That’s why gold investing can be a really great option for new and seasoned investors.
Investing in gold allows you to be flexible in your investment decisions and it could earn you a solid return. If you found this article valuable and you are interested in similar content, feel free to visit our website today!