Since the beginning of civilization, gold has been one of the most sought-after metals in the world. Its lustrous yellow color has enchanted countless numbers of people throughout history. Because of its durability and rarity, it has been used by Nations throughout history as Fiat currency. Fiat currency is what a government chooses to define as legal tender or money. The rarity of gold meant that its value is not easily eroded while its durability makes it a good storehouse of wealth. It is for these reasons also that individuals have purchased gold as a form of safeguard or insurance against the uncertainties of life. Nations may fall, paper money may lose its value but gold will always remain as something of value.
The aim of this guide is to show you how you can also use gold as an investment as well as a tool of investment. As life is full of uncertainties, as a prudent investor, we should also diversify our investment portfolio and manage our risk level. In short, we should not put all our eggs in one basket lest the market crash. History tells us such a thing has happened and can happen again in the future.
As such your investment portfolio should comprise of a wide range of assets with different exposures to different markets. The ideal portfolio should comprise of equities in different market sectors, bonds of different countries, Properties of various kinds, and some liquid cash. Because gold holds its value well, most financial experts recommend a holding of 5% to 15% of your investment portfolio in gold bullions or gold related investments to safeguard against price fluctuations of your other asset classes. The rest of your investment portfolio holdings are determined by looking at the current economic circumstances of a globalized economy.
The precise makeup of your gold or gold related investments will depend very much on your investment objectives. Just like other commodities, the monetary value of gold is subjected to the laws of demand and supply. The question that you need to ask yourself is whether you are investing in this asset class as an investor, speculator or saver. This in turn will determine if you will take a short term speculative position or a medium term position as an investor or a long term position as a saver.
Even then, gold has proven itself to be one of the safest investments in times of economic instability. Having said that, as a prudent investor, you should learn as much as you can about the advantages and disadvantages of investing in gold and the various methods of investing before you commit your hard earned money into investments in this alluring metal.
This is chapter number 1 out of 15. Read the rest:
Read Investments in Gold - Chapter 2: Advantages of investing in Gold Read Investments in Gold - Chapter 3: Disadvantages of investing in Gold Read Investments in Gold - Chapter 4: Guidelines for Investing in Gold Read Investments in Gold - Chapter 5: Investments in Physical Gold Read Investments in Gold - Chapter 6: Bullion Bars and Coins Read Investments in Gold - Chapter 7: Numismatic and Semi-Numismatic Gold Coins Read Investments in Gold - Chapter 8: Gold Certificates Read Investments in Gold - Chapter 9: Allocated Accounts Read Investments in Gold - Chapter 10: Paper Gold Investments Read Investments in Gold - Chapter 11: Gold Stocks Read Investments in Gold - Chapter 12: Gold Futures Read Investments in Gold - Chapter 13: Technical Analysis Read Investments in Gold - Chapter 14: The Motivations for investing in Gold Read Investments in Gold - Chapter 15: Conclusion