Diversification is an essential risk management tool when it comes to preserving your investment portfolio. Stocks rise and stock fall; having something to balance out the market dips and dodges can make all the difference.
Investing in precious metals like physical gold and silver helps hedgers achieve a sense of stability in unstable markets. Conversely, speculators can also engage in profitable short-term metal trading by taking advantage of fluctuating commodities prices.
Whether your aim is to capture quick gains or reduce risk, a precious metals investment can help you meet your financial goals.
One of the best things about precious metals investing is that there is a way for everyone to get involved, from the sophisticated day trader to the casual collector of physical metal as a long-term store of wealth.
The saying “All that glitters is gold” doesn’t necessarily hold up in the commodities market. True, gold is one path investors can take to diversify their trading portfolio with precious metals; however, other rare metal investment opportunities abound. Each commodity provides its own unique benefits for investors and traders.
Gold is the most popular metal for trading and investing, and is known for its durability, malleability and useful chemical properties that allow it to conduct heat and electricity. Even more than its industrial merit in jewelry and electronics, gold is highly valued as a form of currency. From ancient times until the present day, gold has been treasured for both its financial and industrial value, ensuring modern investors that this commodity will retain its worth for the long term.
The runner up of metal trading is silver, which is equally perceived as both a store of wealth and an industrial metal. This factor causes the price of silver to fluctuate more than gold generally. As a more affordable way to venture into the rare commodities sector, silver is often the metal of choice for beginning investors – though its increasing demand in solar energy, medicine and technology is now attracting investors of all experience levels and financial backgrounds.
Platinum is rarer than gold and even fetches a higher price at certain times of market instability. Platinum, like silver, is considered an industrial metal, with the largest demand coming from the automotive sector. Platinum is the metal of choice for automakers as a key emissions-reducing component in catalytic converters. Platinum is also heavily used by the jewelry industry due to its high corrosion-resistance, malleability and ability to withstand heat.
Like platinum, palladium is considered more of an industrial precious metal due to its high demand in the autocatalyst, electronics and jewelry industries. Palladium has the lowest melting point and least density of the Platinum Group Metals (PGM) family, which includes platinum, rhodium, ruthenium, iridium and osmium. Together, Russia and South Africa produce roughly 90 percent of the world’s palladium supply, making prices highly volatile and susceptible to geopolitical factors.
Global demand for all four rare commodities has skyrocketed in the past several years, causing prices to rise. Recent economic and political developments in China and India indicate strong continued interest in these rare, nonrenewable metals for industrial and investment purposes. High demand and limited supply means the price of gold, silver and other precious metals is going one direction – up.
In addition to global demand, precious metals make a smart and safe investment for the following reasons:
The problem of currency depreciation causes investors and traders to turn to an intrinsically valued asset like physical gold or physical silver to preserve their long-term financial worth.
When rising interest rates and economic instability plague the economy, investors repeatedly flock to metal investments to hedge their portfolios against inflation, which keeps prices elevated.
During times of economic uncertainty and geopolitical turmoil, buying precious metals is considered a safe-haven investment and a counterbalance to the threatened value of paper currency.
Just as there are numerous commodities to choose from when investing in precious metals – gold, silver, platinum, palladium – there are also numerous “investment vehicles.” These options are separated into two main categories: physical and paper. Physical metal investments involve buying, selling and trading bullion in the form of coins, round and bars. Determining where to store physical gold and silver, however, leads certain investors to look elsewhere – to paper investments. However, as unlucky investors have found out, paper gold and paper silver are poor substitutions for the real thing.
Paper metal investment vehicles include:
Paper investments in precious metals are man-made financial derivatives of gold and silver. Purchasing one of the options listed above does not mean you own physical precious metals, but rather gives you a representation of it. Why does this matter? Because paper gold and silver can disappear in a flash if the company or market implodes, taking your entire investment down with it.
Wise investors understand that physical gold and silver is the only way to ensure you own precious metals and experience the full benefits from doing so.
With so many ways to benefit, investing in precious metals is one of the savviest choices an investor can make in today’s market. At Elemetal Vault, we make precious metal investing even more convenient with our easy-to-use bullion exchange. Open a free account now, or continue browsing our site to learn more about our services, pricing and fees, how it works and much more.
Store your precious metals, gold, and silver in a secure bullion vault storage. With Elemetal Vault, we partner with the most trusted secure vault facilities in the world to keep your investment safe. When you purchase gold and silver on the Elemetal Vault bullion exchange, you own the metal, it is yours to hold or sell, even as it's in transit to the vault. Your metal belongs to you until you choose to sell it or settle your account using one of our versatile settlement options.
We encourage you to explore our site and learn more about our bullion vault storage and precious metals trading services: