Investing with a Gold IRA – Your hedge against stock market crashes or inflation
What is a “gold IRA kit” investment? Why not simply keep your money in an diversified portfolio of stocks, bonds and ETFs instead?
First, let us explain what gold means as an investment. Unlike other equity investments, such as bonds and stocks, gold as an IRA purchase is a product – the owner holds a tangible physical product, something actually valuable. The investor, on the contrary, owns a part of the stock company that issued it. Equity investments are, however, a form of equity. Stockholders make money when they have stock in companies that increase profits or improve their business standing. This increases profit, which results in increased demand for stock. This causes the stock price to rise. Precious Metal Investors make money when there’s more demand for precious metallic, which leads to an increase in the “spot prices” of metals.
Stock Market outperforms gold
In the past, the stock market has performed significantly better than precious metal investments. Precious metal investments have traditionally been viewed as a hedge for inflation and risk rather than as a profit-seeking venture. However, over the last 12 years, this fact has changed significantly: the Dow Jones Industrial Average has seen significant outperformance by silver and gold. In times of economic uncertainty, the gold standard for investment has been after U.S. Treasury issue, and it continues to be a reliable safety investment. Its price can often follow economic or market swings. It has proved to be a reliable investment in times of inflation due to its ability to retain its value far better than currency-backed securities, which can fluctuate in value and increase in price.
Protect yourself against the next market crash
Why would you choose to put your money into a Roth IRA or self-directed gold IRA? This was clearly demonstrated in 2008, when the gold price fluctuated from approximately $720 per ounce up to nearly $980 per ounce. Gold prices shot up as the stock markets crashed and economies fell deeper into recession. When investors are anxious or looking for a safe investment to protect their capital from the risky stock markets, gold prices do exceptionally well.
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