Stuart Simonsen of Billings, MT is an entrepreneur in the financial sector, and frequent contributor on precious metals investing. In the following article, Stu Simonsen discusses some of the basics for investing in gold, and what every financier should consider when adding gold to their portfolio.
Gold is considered one of the most universally valuable resources explains Stu Simonsen. It is internationally recognized and has been used for thousands of years as a form of currency. As an investment, gold is a wise choice because it has steadily increased in value over the last several hundred years. It is also recession and inflation resistant.
Stuart Simonsen on Gold ETFs
Stuart Simonsen of Billings, MT says that when investing in gold, the expectation is not to purchase a pile of gold bars – but it is investing in the value of gold, such as ETFs in the stock market.
In these stocks, each one represents a certain price of gold which will vary based on the stock the investor chooses to participate in. The stock is directly tied to the value of gold. This means that even in the case of a recession or a time when the market is more volatile, one doesn’t have to worry about the value of gold changing drastically.
Stu Simonsen says that is one of the major appeals to investing in gold. The value of gold has steadier changes, and it won’t lose all of its value over the course of a week unlike cryptocurrency investments.
Keep in mind that with this strategy you are still investing in a long-term stock, just one that is tied to the value of gold.
Invest Ahead of Recessions
One of the main benefits of gold investments is that one can avoid the volatility of the regular market. Throughout past recessions, gold has still historically maintained its value making it one of the few investments that did not completely tank.
Stuart Simonsen of Billings, MT says that gold has historically had an inverse relationship with recessions, meaning that during some of the most notable downturns, gold has increased in value. In the most recent three recessions of 2001, 2007, and 2020, the price of gold increased while the average value of other investments had decreased.
This is partly because investors tend to flock to gold when there is uncertainty in the market, and partly because the value of gold is tied to a physical asset explains Stu Simonsen.
Invest in a Diverse Portfolio
One of the best things that any investor can do, whether they are interested in investing in gold or not, is to diversify their portfolio, and investing in gold is a great way to do so.
Gold has a very stable value, meaning that it is somewhat immune to the rapid fluctuations in value that other investments experience.
This means that it would be rare to “lose it all”. However, this can also mean that the potential for making a lot of money as a short-term goal on this investment is lower. Think of gold investments as a marathon, not a sprint.
Investing some money in gold will maintain the portfolio’s value while investing in other markets is what will help the portfolio to grow. To have healthy investments that will grow over time and increase in value, it is important to do both explains Stu Simonsen.
Invest in Mining Companies
Another gold adjacent investment that one can make is investing in mining companies.
Investing in physical gold isn’t practical for every investor and it’s also important to diversify one’s portfolio outside of just one type of investment. Investing in mining is a way of diversifying while still keeping it in the more stable gold market.
Although mining companies are not gold, they are directly tied to the gold market and their value follows that of gold. As long as gold stocks are doing well, the value of mining companies is also doing well.
Invest Before Price Increase
To take advantage of gold during a recession, it is important to buy the gold before it experiences a price increase.
Of course, the price of gold is continuously increasing, and that is what makes it such a valuable asset. By investing in gold now, the investor is able to get ahead of the price increase that inevitably comes every year.
With gold, Stuart Simonsen lawsuit explains that the investor is participating in a long-term stock. On the day-to-day basis, they won’t be making that much money, but over the years the value will increase steadily.
Buy from Certified Sellers
When buying physical gold, it is crucial to buy it from a certified seller. A certified seller will have all of the information about the gold, know its value, and sell actual 24k gold.
Although gold is considered a long-term investment, there will come a time when the investor sells it. When this is done, it is important to have the papers documenting that the gold is pure gold that way they can sell the gold for maximum profit.
Conclusion
When investing in gold, the investor needs to consider which part of the gold market they want to invest in. There are many choices, one can invest in physical gold, gold stocks, or gold adjacent business. All work and will suit different investors’ needs.
If choosing to invest in physical gold, it is important to buy from a certified seller that way the gold will come with all the paperwork necessary to sell it at maximum value one day.
