1. Gold is real money
Everything else is paper, which they can print as much as possible. But they can’t print gold. Also gold is the only currency that has survived more than 100 years. In a world where all returns are fake, and momentary, gold provides the only real return.
2. It’s highly liquid
Apart from the stability gold provides to your portfolio, it is traded around the globe 24 hours a day. With gold, you possess an international currency which can always be sold around the world at any time. Plus, with the coming of Gold ETFs, now you can buy and sell gold on the stock exchanges, as easily as you buy or sell your stocks.
3. Worried about the rising geopolitical tensions?
The deteriorating conditions in the Middle East, revolts in the US and Europe, the nuclear ambitions of North Korea and the growing conflict between the US and China headline the geopolitical issues, which could explode at any time. A fearful public has a tendency to gravitate towards gold. Before they do, why don’t you?
But how much?
“How much gold should I have in my portfolio?” you may ask.
Not more than 5-10% of your financial savings. See, you must definitely have this much gold in your portfolio for the reasons mentioned above. But the fact remains that in a growing economy like India, sound and solid businesses provide a greater opportunity to grow your wealth in the long term.
So, good quality stocks and mutual funds are your best route for wealth creation.
Gold, on the other hand, is an excellent way for wealth preservation.
So if you don’t have gold in your portfolio, buy now…but have a limit to how much you buy of it (and let your wife know that limit :-)).
cause you are a buffet fan i thought you will have similar thoughts “GOLD its just a metal what can i do with it, if i get a cube i can just sit on it” this is not exact but something similar was said by him right?
Again, how do you buy them? jwellery / coins and from where?
Vishal Khandelwal says
I am definitely a Buffett fan but then my investment views and style are not defined by his thoughts entirely.
My strength still lies in stocks, but I believe gold returns well when all other returns are fake (speculative, and driven more by the central banks printing money).
As for how to buy gold, direct purchases of gold bars/coins or ETF…any of these ways is good.
I, for instance, regularly invest in gold..like an SIP…with a view to provide the same to my daughter when she grows up.
Hope that answers your questions.
to your point about central banks printing money.
Would love to know what you think about the movie Zeitgeist, https://zeitgeistmovie.com/ the movie has 3 parts that has been released, its free to download and watch and it must be watch in the sequence it was released.
Whenever you get time watch it and let me know what you think about it and how it changes your thoughts about money and markets and so on;
Vishal Khandelwal says
Sure Vikrant. Will see when I can watch the movie.
Delores Lyon says
Thanks for sharing these tips on buying gold. I agree that the value of gold is very stable, so it is a great way to ensure that you have money. It is also a great way to store cash in an unorthodox way, since it isn’t just cash. In fact, I think that everyone should look into gold as an investment!
Hiren Khambhayta says
Hello Vishal, thank you for this article. I have one doubt whether we should go with gold etf or with gold bonds when they are opened by RBI or buying the one which are traded daily on stock exvhanges.
And thank you for the regular newsletters too. 😀