Are you already investing in gold? Then it’s about time!

Gold as a retirement provision and protective shield against stubborn waves of inflation

Speaking of uncertainties – you have no doubt taken a look at the current inflation rates recently. You might think that inflation has become as entrenched in many economies as the “temporary” Swiss highway toll sticker once was. Even if you might be smiling now, the reality is quite serious: We have reached inflation rates in the USA and the eurozone that we were last confronted with decades ago.

The good news: gold can bring stability back to your portfolio. Gold? Yes, I know, in the age of cryptocurrencies that sounds hopelessly old-fashioned and dusty. But old-fashioned and dusty still works in asset management. It is therefore no coincidence that many investors want to save gold or even top up their retirement provision with gold. To make yourself somewhat independent of the whims of the financial markets, investing in gold is literally “worth its weight in gold” or, as I like to say, “Gold always shines, even when the stock market isn’t so shiny!”.

However, we should keep an eye on the current geopolitical tensions, as they have far-reaching consequences – including for the gold market. The decision by Western countries to restrict Russia’s access to its currency reserves could turn out to be a game changer. If central banks from China to Saudi Arabia increasingly redistribute their reserves from European and American government bonds into gold, this could further boost the gold price.

What you should know if you are planning to invest in gold

You don’t have to find gold sexy to recognize that it has also proven its value as a precious metal in previous market turbulence. So the idea of investing in gold yourself is an obvious one. Now you may be asking yourself: “But how exactly should I invest in gold?” – A legitimate question! I can tell you that there are many different ways to invest in gold. From physical gold in the form of coins or even bars to gold mining shares – each option has its advantages and disadvantages, which you should weigh up carefully.

However, you should be aware of one thing: Compared to dividends or interest, gold does not generate current income. The return on gold always depends on the current price trend. It therefore makes sense to consider gold as part of a broader investment strategy. In order to spread risks and hedge your assets, a share of 5-10% gold can already strengthen your portfolio.

Gold as a safe haven – current forecasts and trends

Gold prices have reached new highs in 2024 and analysts even expect this trend to continue for the time being. As you can probably already imagine, this trend development has not come out of nowhere: a combination of expected interest rate cuts, ongoing inflationary pressure and geopolitical tensions are driving the current trend development of gold.

Finally, I would like to share one more thought with you: In our rapidly evolving world, where new technologies and forms of investment “fall from the sky” almost daily, there is something reassuringly enduring about gold. Or, as my grandparents used to preach to me: “Gold is money, everything else is credit”.

With this in mind, invest in gold and stabilize your portfolio!

Yours, Mark Stock©

Mark Stock is a member of the Point Capital editorial team. “I am a stock market enthusiast and am passionate about economic history. I have been following the ups and downs of the markets for years and, of course, invest myself – preferably in shares. So my name says it all. Every month, I take up what I consider to be an exciting topic. And since the focus is on the content and not on me personally, I write under a pseudonym.”