Why should you store your wealth in precious metals?
Published on 16th August 2022
As crises continue to impact the world economies, you want to make sure that your personal wealth is safe and not losing its value. Inflation, supply chain issues, environmental disasters, and global conflicts have all recently reared their ugly heads, negatively impacting global finances. Stocks, real estate, and other investments may have their place in your portfolio, but they are often directly affected by these headwinds. Headwinds that look to continue for the near if not distant future. Precious metals,like gold and silver, however, have a long history as safe havens when it comes to protecting wealth, even through tumultuous times such as these.
Introduction
Gold and silver have been prized as treasured commodities for millennia, practically ever since man has traded goods and services with each other. Beyond their use as a store of value to be used in commercial transactions (i.e., as coins), people also value silver and gold jewelry, increasing the metals’ overall appeal and worth. On a more practical note, both gold and silver have a wide range of industrial uses. Gold’s conductivity makes it ideal for many electronic applications, from mobile phones to space shuttles. Silver, also significant in electronics, has uses in solar energy, medicine, and manufacturing.
With these wide-ranging benefits, one could understand how both gold and silver have steadily increased in value over the years. Over the past 50 years, gold has increased over 5,000% in value, while silver has seen a more modest yet impressive gain of more than 983%. There have been spikes and troughs over this time, but when looking at the overall picture, both gold and silver have proven not just resilient but consistently flourishing.
Gold Price US$ / ozt from 1974 – Present
Silver Price US$ / ozt from 1975 – Present
Wealth Preservation
Therefore, when it comes to preserving wealth by hedging against inflation and economic downturns, such as we have been witnessing recently, many professionals and experts turn to precious metals, specifically gold and silver. Some could question the risk appetites of investment bankers and brokers, but central banks are known more for their fiscal conservatism. They seek to protect their country’s monetary standing, and they are, on the whole, net buyers of gold. China’s central bank, for example, increased from just under 400 tonnes in Q1 2000 to almost 2,000 tonnes 20 years later. The value of precious metals as a safe haven cannot be minimized.
Portfolio Diversification & Liquidity
Part of this hedging involves diversifying your portfolio. This requires an assessment of risk, allocating investments based on how much you are willing to risk. While some instruments, such as stocks, entice with immediate, high reward, the level of risk can also be as high, and immediate. So, in these uncertain times, stalwart investors such as central banks have been contemplating movements to alternative investments beyond the dollar and euro to the yen and renminbi, while remaining committed to gold.
Beyond the protection and safe haven advantages, gold and silver also offer greater liquidity and freedom than other forms of investment. Gold and silver are international languages, so to speak, as they are recognizable and accessible by traders all over the world. This has been the case since the Roman Empire, as gold coins were found at ancient Silk Road outposts in China. So, it would stand to reason that some modern-day investors would look to gold as a currency, especially when it facilitates smoother business transactions.Gold coins are recognized and accepted by many businesses as means of exchange, understanding the precious metal’s benefits for protecting wealth and beating inflation.
Privacy & Confidentiality
Further on governments, many investments, including securities and currencies, are regulated by and under governmental authority. This means that you could lose access to your accounts due to circumstances beyond your control. Such as in the recent crisis in Henan, China, where people found their accounts frozen as a result of investigations that were unrelated to many of them. This went on for months.
While such situations may seem rare, having gold or silver stored in a private vault provides peace of mind in uncertain times. With precious metals providers like J. Rotbart & Co., authorizations are established well in advance with safeguards in place to ensure you have access to your gold or silver bullion whenever you need it.
Gold and silver are well-established and trusted investments for protecting your wealth that also offer you flexibility, liquidity, and easy access when you require funds. J. Rotbart & Co. understand how gold and silver can benefit you and offer a full range of services to fulfill your precious metals needs. If you would like to find out more about expanding your portfolio or protecting your wealth with gold, silver, or other precious metals, contact our team today
Secure Storage Vault at Le Freeport, Singapore
Let J. Rotbart & Co. Assist in Increasing Your Precious Metals Holdings today!
J. Rotbart & Co. provides efficient and reliable solutions for clients wishing to buy, sell, store, transport and finance physical precious metals. We source precious metals bars and coins globally in a secure and confidential manner. The bars and coins are all newly minted and are sourced from refineries and mints of the London Bullion Market Association (LBMA), thus guaranteeing their authenticity. The bullion can be deposited in secure storage facilities in a dozen locations worldwide or delivered globally to a location of your choice.
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