Connect with us

Business

Why Gold Is Popular Amongst Investors

Avatar

Published

on

Traditionally gold has been an important part of international economies. 

It is no longer a principal currency, but it remains a real long term investment. 

This is principally the case in a bear economy (a drop in prices for a few months in an asset).

 

A Surge in Gold Demand

The demand for gold had increased by 21% in the first quarter of 2016.  

gold first quarter

This is the quickest jump on record.  

The rise came despite a fall in the demand for jewelry and electronics which declined by 3%.

Inflation is considered a keystone for gold’s attractiveness.  Inflation remains constant in the developed world.  

However, global uncertainty caused investor’s push for gold.

The price of gold has increased more than 20% this year, which was the fiercest price performance in almost three decades.

As gold prices swell, one of Wall’s Street’s major banks is flocking to gold.

 The expectation is that it will reach $1400 this year.  

This makes it a very viable commodity and also it has a low storage fee.

[ms_divider style=”normal” align=”left” width=”100%” margin_top=”30″ margin_bottom=”30″ border_size=”5″ border_color=”#f2f2f2″ icon=”” class=”” id=””][/ms_divider]

[ms_featurebox style=”4″ title_font_size=”18″ title_color=”#2b2b2b” icon_circle=”no” icon_size=”46″ title=”Recommended Link” icon=”” alignment=”left” icon_animation_type=”” icon_color=”” icon_background_color=”” icon_border_color=”” icon_border_width=”0″ flip_icon=”none” spinning_icon=”no” icon_image=”” icon_image_width=”0″ icon_image_height=”” link_url=”https://offers.thecapitalist.com/p/58-billion-stock-steal/index” link_target=”_blank” link_text=”Click Here To Find Out What It Is…” link_color=”#4885bf” content_color=”” content_box_background_color=”” class=”” id=””]This one stock is quietly earning 100s of percent in the gold bull market. It’s already up 294% [/ms_featurebox]

[ms_divider style=”normal” align=”left” width=”100%” margin_top=”30″ margin_bottom=”30″ border_size=”5″ border_color=”#f2f2f2″ icon=”” class=”” id=””][/ms_divider]

The World Gold Council – Factors Affecting Gold Popularity

 

Is Gold a Safe Investment in Current Precarious Times?

On May 12, 2016, gold fell in value. 

This was in direct contrast to the 15th month high it experienced the week before. 

A strengthening dollar encouraged some buyers to cash in shares.

The value needs to revert to a level of $,1300 for the market to move from a technical outlook.

At present, the US dollar is very robust compared to other exchanges such as the Euro or Yen.

As the dollar has consolidated, the price of gold has fallen.

If the dollar changes direction or crumbles, more investors will revert to gold, increasing demand and the price.

 

Ways of Investing in Gold

  • Traditionally investors have bought gold bullion bars.
  • Gold coins are a popular way of investing in gold.
  • Gold Exchange traded products – these carry risks and incur expenses.
  • Gold certificates – banks replace gold with certificates.
  • Shares in gold mining companies.

 

Barrick Gold Corporation – A Lucrative Investment Opportunity

The majority of Barrick Gold Corporation’s maneuvers are based in America – 50% in North America and 43% in South America. 

It has the five largest mines which produce 60% of the global gold production.  It produced over 6.25 billion ounces in 2014.

Barrick Gold Corporation is the world’s largest and most successful gold establishment.

However, increasing debt threatened to derail the company.

In 2016, the corporation has been working to reduce its debt to make the company a viable choice for investors.

The company is committed to only establishing spending plans that will add value for shareholders. 

It plans to highlight capital self – control and lower costs at mines which are already one of the lowest costs in the business. 

It aims to lower debt by another $2 million in 2016.

These cost cutting measures are working for investors as stock has increased by 114% so far this year.

barrick gold price

 

Conclusion

The cost of gold usually remains quite stable over extended periods.

However, it can vary in price. 

The price of gold is high at present, but it is gradually starting to decline.  

But, history has demonstrated that the price of gold will thrive.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

Republicans Ready To Finalize Stimulus Bill As Dems Continue To Squabble

Avatar

Published

on

Republicans Ready To Finalize Stimulus Bill As Dems Continue To Squabble

Treasury Secretary Steve Mnuchin and White House Chief of Staff Mark Meadows met with House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer on Saturday. This is a rare weekend session to try and break the stalemate between Republicans and Democrats over the next stimulus bill.

No deal was finalized. However, Mnuchin said he and Meadows were willing to meet with Democrats every day. This can go on until an agreement is reached.

The sticking point for Republicans is an unwillingness to extend the $600 per week unemployment benefit. They feel the amount needs to be pared down to a more reasonable $200 per week so that unemployed workers have a financial incentive to find work instead of making more money by remaining unemployed.

Unsurprisingly, Democrats want the $600 to be reinstated and have tied it to a host of other demands that have nothing to do with the pandemic, like their insistence on approving $1 trillion to be sent to state and local governments to fund budget shortfalls, food stamp increases, and assistance to renters and homeowners. Mnuchin said that’s “something we’re not going to do.”

Democrats Refuse to Agree

Mnuchin appeared on ABC’s “This Week” yesterday. There, he said the White House understands the need for extra unemployment benefits. However, he also says the Democrats are holding up the deal.

“The president is very concerned about the expiration of the unemployment insurance,” Mnuchin said, adding “We proposed a one-week extension at $600 so that, while we negotiate a longer term solution, at least all those people don’t lose their money. I’m surprised the Democrats won’t agree to that. They’re insistent on having a larger deal.”

He also said that Republicans aren’t willing to burden our country with more debt.

“There’s obviously a need to support workers, support the economy,” Mnuchin said. “On the other hand, we have to be careful about not piling on enormous amounts of debt.”

Until a Deal Is Made

He added that the White House supports a one-week extension of the $600 per week until a deal is struck. However, he believes $200 is a more appropriate amount for the extra weekly benefit.

“There are cases where people are overpaid,” Mnuchin said.

He did add that both sides agreed on the need for another $1200 stimulus payment for Americans, and that once approved, the checks could be in the mail within a week.

Both sides have agreed to meet daily until a deal is struck, and at least one Democrat sounds optimistic that a deal will be reached sooner rather than later.

“This was the longest meeting we’ve had and it was more productive than the other meetings,” said Schumer. “We’re not close yet, but it was a productive discussion — now each side knows where they’re at.”

Chief of Staff Meadows, however, doesn’t expect a deal is forthcoming. Appearing yesterday on CBS’s “Face The Nation,” Meadows said, “I’m not optimistic that there will be a solution in the very near term.”

Up Next:

Continue Reading

Business

Here’s Why The ‘Cockroach Portfolio’ Is Gaining Popularity

Avatar

Published

on

Here’s Why The ‘Cockroach Portfolio’ Is Gaining Popularity

Ray Dalio, the founder of Bridgewater Capital, calls it the “all-weather portfolio” and it’s helped his investment management firm amass roughly $140 billion in assets.

Former Libertarian presidential candidate Harry Browne called it his “fail-safe investing” portfolio. Additionally, It just had its best three-month return ever. It returned 18%, far exceeding its average annual return of 7%.

Browne’s investing philosophy was that when times are good, stocks do well. Meanwhile, bad times are good for Treasury bonds, and gold does well during stagflation. Also, cash is king during a recession or crisis.

Since we don’t know what the future holds, Browne advocated for putting 25% of your portfolio into each asset class. He also suggests being prepared for whatever comes. With bonds, gold, and Treasury’s in your portfolio, you’ll underperform during a bull market. However, you can more than make up for it by softening the blow during a down market.

The “Cockroach” Portfolio

Back in 2012, Dylan Grice, a former strategist with SG Securities, called that type “the cockroach” portfolio. He dubbed it as such due to its ability to survive anything thrown at it.

“What I like best about cockroaches,” wrote Grice, “isn’t just their physical hardiness, it’s the simple algorithm they use to survive. According to Richard Bookstaber, that algorithm is ‘singularly simple and seemingly suboptimal: it moves in the opposite direction of gusts of wind that might signal an approaching predator.’ And that’s it. Simple, suboptimal, but spectacularly robust.”

Grice has calculated that for long-term investors, this type of portfolio has done at least as well as the traditional 60/40 stock and bond mix since the early 1970s. But most importantly, it managed to avoid any massive drawdowns.

And just like cockroaches, your first job is surviving as an investor, says Groce, while prospering is job number two.

A Similar Approach

Fortunately for investors who are looking for this type of portfolio, an ETF has recently launched that follows the same approach as the “cockroach” portfolio.

It’s called The Advanced Research Investment Solutions Risk Parity ETF (RPAR) and was launched last November. Alex Shahidi, the managing partner and co-chief investment officer, says they’re up to $620 million in assets so far.

He says the ETF has returned 12% so far this year compared to 1% for the S&P 500.

Most importantly, during the crash in March it fell just 15%, less than half of the drop in the S&P 500.

According to Shahidi, the fund is 25% stocks, 15% industrial commodities, 17.5% gold, 20% long-dated Treasury inflation-protected securities and 42% long-term Treasury bonds. Total exposure to the market is 120%, because the fund is 20% leveraged.

The stock mix is half U.S. and half overseas stocks, with the overseas portion tilted toward high volatility emerging markets.

Nobody knows what the market will do next, so Shahidi says you want to be prepared for any outcome. “You want to be diversified to (different) economic environments,” he added.

He did say that “If I had to pick an asset class for the next 10 years, it would be gold.”

Up Next:

Continue Reading

Business

How To Buy Gold For Your Investment Portfolio – Part 2

Avatar

Published

on

How To Buy Gold For Your Investment Portfolio - Part 2

Yesterday was part one of buying gold and silver coins for your investment portfolio. With gold and silver both on a hot streak, investors are looking for the fastest way to gain exposure to and buy precious metals. You must be prudent and exercise caution so you don’t make a mistake and find yourself with a bad investment.

Do: Buy Gold With Your Savings

Don’t borrow money to buy gold. Use your savings so when you take possession of your gold, it’s yours without any claims against it. With volatile gold prices, you don’t want to be paying back a loan on your gold if the price suddenly dips.

Don’t: Buy Gold With Credit

The current financial system is built on fiat currency and debt with dollars being printed out of thin air. The reason to own gold is the opposite of that. So to purchase gold by using the system it is protecting against defeats the purpose of owning gold. Just use your savings and own your gold outright from day one.

Do: Store Coin Nearby

If a crisis hits and you need access to your gold, you don’t want to be out in public trying to retrieve your gold. So whether it’s in a small safe hidden in your house or buried in your yard, keep your gold nearby for easy access.

Don’t: Store Coins In a Safety Deposit Box

Storing your gold at a bank sounds like a safe decision. But it’s a bad idea for a few reasons. The first is that if there were ever a crisis, you have to go to the bank to retrieve your gold. That assumes the banks will be open during a crisis. Then you have to get access to your safety deposit box, retrieve your coins and safely get them home. That’s a lot of things that need to go right during a crisis. Additionally, gold has been confiscated before. Here in the US, gold was confiscated in 1933 under Franklin Roosevelt. If it were to happen again, gold stored at home, where there is no record if it, is much safer.

Do: Only Invest With Money You Don’t Need For Awhile

Nobody knows when inflation will hit, or the dollar will collapse, or when gold prices will finally take off. But we aren’t trying to time any of those occurrences. The reason to own gold is a long term store of value. So you don’t want to speculate in gold. We could see prices move higher or significantly lower. But long term, history has shown that gold prices steadily march higher as the dollar steadily declines in value. So when buying gold, make sure it’s with money that you don’t need in an emergency. We suggest using savings or other funds that you don’t need to worry about getting access to for at least five years.

If you have any more questions about investing in gold, find a reputable gold coin dealer near you. They will be glad to answer questions.

Continue Reading
Advertisement

Facebook

Trending

Copyright © 2019 The Capitalist. his copyrighted material may not be republished without express permission. The information presented here is for general educational purposes only. MATERIAL CONNECTION DISCLOSURE: You should assume that this website has an affiliate relationship and/or another material connection to the persons or businesses mentioned in or linked to from this page and may receive commissions from purchases you make on subsequent web sites. You should not rely solely on information contained in this email to evaluate the product or service being endorsed. Always exercise due diligence before purchasing any product or service. This website contains advertisements.

[email]
[email]