Do you have capital that you would like to invest to build your wealth? You do not know concretely in what to invest to ensure a return on investment? Gold responds perfectly to these equations. This yellow metal, synonymous with prosperity, has stood the test of time and the various crises of history. This precious metal that shines brightly is the most popular among investors thanks to its many advantages. Discover in this article some reasons why gold is a good financial investment.
Gold: a safe haven since its creation
A safe haven is considered an investment that maintains or increases in value during major financial or systemic crises like COVID-19. Gold indeed, for millennia has not lost notoriety. On the contrary, it has survived the greatest crises in history to become a coveted store of value.
Gold is the only form of money that has not been eliminated from circulation. This explains why banks spare no effort to invest in gold. In times of economic instability, while other assets collapse, gold has only increased in value. It is therefore an ideal investment to diversify your savings.
Gold is a stable asset
Gold has a reputation for staying stable over the long term. Despite the increase in new technologies and inventions, the yellow precious metal has remained much less volatile than other financial market assets. This is explained in particular by its indestructibility and its particular use.
Indeed, unlike most raw materials, gold is transformable, recyclable and therefore favors continuous use. Volatility is based on the principle of supply and demand. The supply, which is particularly high due to its recyclable side, allows the market to effectively withstand shocks and shortages of raw materials.
Central banks and some institutions are buying more and more gold
According to certain investigations, part of the central banks continue to invest in gold. This phenomenon has raised the historic record of purchases of gold bullion by banks. Gold exists in two main forms. These include physical gold and paper gold. As for physical gold, you can buy it at precious metal trading desks or through online brokers.
Once in possession, you can save it at the level of banks as an investment fund. It is a very good way to deal with crises such as inflation. This explains the strength of banks and some large institutions in the event of an economic crisis.
Strong global demand for gold
Industries and investments cause an increasing increase in the demand for gold. Great nations like China and India are famous for their attachment to this precious metal. The observation is made through a percentage of +50% of world demand.
These two great countries are known for their large possession of gold jewelry. All these factors promote the durability of the metal and make it a real safe haven in the event of crises.
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