Gold prices went through a tough summer and many hope that gold prices have finally reached their bottom. In a market where everyone seems to be selling their gold, why are gold bugs happy? While itís true that their existing gold bullion may be worth less today than it was a year ago, gold prices falling is great news for gold bugs who have the capital to wait until prices start to climb again. Falling gold prices are an opportunity to increase your position and make money down the road.
Should you be taking the opportunity presented by lower gold prices to get into the market? If you havenít bought gold bullion before, ask yourself what kind of investor you want to be. These are some of the characteristics of investors who make well with gold.
1) Youíre Patient
Youíre not in a hurry to make a ton of money quickly. Anyone out to make a fast buck through investing is going to have to make big risk decisions. Gold is a low-risk safe haven asset that performs better than inflation and preserves wealth over time. Gold can make an effective, long-term retirement investment rather than a fast buck.
Bull markets will result in huge gains. Those are notoriously hard to predict, but when they happen, gold prices appreciate by huge margins. If youíve bought gold at a low price, you reap huge returns selling gold coins and bars, but you may have to wait.
2) You Want Diverse Investments
You donít have to be a stock-picker to get into gold or other commodities. Buying gold coins and gold bars is an effective way to offset riskier investments in your portfolio such as stocks. Gold does especially well after a stock market crash or a recession, when investors are nervous about stock markets and start to invest in low-risk assets that they know will appreciate.
3) You Want Real Value
A dollar loses value every year. The purchasing power of currency is constantly eroding, whereas gold maintains its purchasing power and rises in value. A fascinating chart displays the purchasing power of the US dollar since 1718 compared to gold. While currency was still on the gold standard, the dollar only underwent extreme devaluation during times of crisis like the Civil War. Since the end of the gold standard in 1971, the purchasing power of a dollar has plummeted compared to gold.
Gold can be a very useful asset for any investor. One of the most affordable ways to buy real gold coins is from an online dealer such as Silver Gold Bull, which sells gold coins and gold bars from around the world. Any gold dealer that can help you buy gold as part of a retirement savings plan or at lower premiums is worth looking into.
Low gold prices are a great opportunity for someone who wants to get into the gold market. Take advantage of low prices and diversify your portfolio.