Page 8 - Investing in the Stock Market vs. Precious Metals

This stability of gold and silver is why so much of these metals is still held by governments, central banks, and international financial institutions. They realize that when all their other reserves become worthless, their precious metals holdings will still have value. For them, just as for individual investors, gold, silver and other precious metals really are the asset of last resort.
Long-Term Store of Value
Gold and silver are an excellent store of value, which is why they have been trusted for centuries both as a form of money and as an investment asset. Almost all the gold ever mined remains above ground today, ensuring that plenty of gold endures in both good times and bad.
Market cycles of boom and bust occur with regularity, but gold maintains its value throughout. In contrast, paper currencies such as the US dollar decline in value every year. This explains why so many investors often purchase gold or silver as a hedge against currency fluctuations and inflation.
Both gold and silver made average annualized gains of over 30% during the stagflation of the 1970s.2,3 And if they repeat that performance as inflation rises in the future, those with gold and silver in their portfolios could end up making some great gains.
Short-Term vs. Long-Term Investing
The outlook of investors who buy precious metals often differs from those
who buy stocks. Many people who buy gold and silver are looking for long- term wealth protection, asset accumulation, and protection, whereas many people who buy stocks are looking for quick gains more akin to gambling than investing.
Precious metals aren’t a get rich quick scheme, they’re part of a long-term wealth protection strategy. Treating gold and silver like stocks and thinking that you can get in and out in a short period of time with big gains could leave you disappointed.
Precious metals aren’t a get rich quick scheme, they’re part of a long-term wealth protection strategy.
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