Investing in metals, like gold or silver, is a good choice not only because it will always be considered valuable, but because it also helps to protect your other investments.
The stock market is filled with companies that look promising because they lure you with the false idea that buying their shares is easy money. The truth is that the success of any investment depends on many factors, and part of it is having good luck. Of course, you can either choose to take big risks and invest in a company that may become big in the future, or you can invest in goods that are already necessary and can deliver revenues in the stock market on the short run.
One of the biggest enemies of stocks and investments is the inflation; when inflation grows, the value of your assets diminishes. In such cases, there are only a few commodities that can balance the loses, and those are the precious metals. When the dollar lowers its value, people in the stock market tend to buy gold and silver because they are not that dependant on inflation as other investments and, therefore, they can help you maintain the general value of your portfolio (the combination of all your investments and assets).
This is a very safe and recommendable measure, given the uncertain environment of the global economy these days. Buying gold and silver is a way to keep safe on the long term in a hard world.
Investing in metals
Although metals are a good defensive strategy, you must keep in mind that, when times are good, precious metals don’t often offer a good return. Precious metals hold their value over time, but it makes no quick earnings, that is the reason they are considered a store of value: that is, a type of currency that is not dependant on inflation and, therefore, is very helpful on a rainy day.
The fact is that putting all your money in only one kind of investment is risky for any asset, including gold or silver; it is best that you keep your portfolio balanced and diversified. Precious metals have the additional advantage that they will take care of the rest of your investments when it is needed.
Gold and silver are the obvious choices to go if you are convinced that you must invest in metals. The price of silver is more volatile because it is not just considered a store of value, but it also has industrial use like silver-based photographs (which are not that common anymore, but they are still produced), batteries, electrical appliances or medical tools. Gold, on the other hand, is not that significant on the industries, but it is one of the most important asset in global economy, along with oil.
But there are other options that you might want to consider: platinum tends to reach a higher price than gold in times of economic and political stability, because it is quite rare. It is also considered an industrial metal used for catalysts in motor vehicles, jewellery and computers.
If you want to invest in precious metals, you can start with buying shares in mining companies that search new places of extraction or are already digging. You can also purchase antique coins or commemorative coins that are made with such metals: those will hold and even increase their value overtime. The precious metal market might be intimidating, but you do not have to invest a large amount of money, if you look for the correct penny stocks to invest in.