Investing
Gold Investment Guide
Gold has been a store of value for over 5,000 years. It does not pay interest or dividends — its only return is the change in price — but it has historically held purchasing power across currencies, wars and economic cycles.
Why investors hold gold
- Inflation hedge. Gold tends to rise when fiat currencies lose purchasing power.
- Crisis insurance. Demand spikes during geopolitical and banking stress.
- Portfolio diversification. Gold has low long-term correlation with stocks and bonds.
- No counterparty risk. Physical gold is no one's liability.
The downsides
- No yield — no interest, no dividends.
- Storage and insurance costs for physical gold.
- Premiums above spot price erode returns on small purchases.
- Price can be flat or negative for many years (e.g. 1981–2001).
Ways to invest
Physical bullion
Bars and coins you own outright. Highest control, requires storage.
Gold ETFs
Funds like GLD or IAU. Easy to trade, no storage, but you don't own the metal directly.
Mining stocks
Leveraged exposure to the gold price plus company-specific risk.
Futures & options
For experienced traders only. High leverage, high risk.
Typical allocation
Most financial planners suggest 5–10% of a portfolio in gold as insurance. Higher allocations (15–25%) are common among investors who expect persistent inflation or currency debasement. Always confirm with a licensed advisor — this page is information, not advice.