Image Source: Unsplash
The global pandemic has seen gold prices rise to their highest ever levels, and if you do not already have a gold investment in your portfolio, it may be something that you consider adding. There are many reasons to be optimistic about the value of gold in 2021, and some experts predict that prices will stabilize this year and maybe increase in value even more. Below are some reasons why an investment in gold in 2021 may be the shrewdest investment you make.
Popular Reasons To Invest In Gold
There are many different reasons people invest in gold, and one of the most significant ones is preserving their wealth. As with most commodities, gold has ups and downs, but it usually increases in value over a decade. If you had $50 in 2000 and kept this till today, your money would still hold the same value. However, if you had $50 worth of gold, the value of this would increase significantly.
Gold is also considered an excellent hedge against inflation, so it is a popular investment vehicle. It is also a safe-haven investment that is not affected by interest rates or volatile market conditions, making it an attractive prospect for many investors. You can check out the best place to sell gold in Adelaide with ease. Gold is an investment that anyone can make if they have the funds available.
Uncertain Markets See Gold Prices Increase
The value of gold is not directly linked to the stock markets, but when they face uncertain times, and the stock’s value goes down, you will often see the value of gold go up. With the global pandemic hitting economies hard with many companies ceasing trading and going bust, we are in uncertain times, which is reflected in the stock markets around the world. Now is an excellent time to add gold to your investment portfolio, and although gold prices are now stable, experts predict you could see the price go up again this year.
Demand Has Dropped But Prices Are Still High
We saw the demand for gold drop significantly due to the pandemic, with China & India, the two countries with the highest demand for gold, drastically reducing their purchases in 2020. Even though the demand has dropped, the price of gold has still increased, and with fuel prices low, gold production has been high in 2020, considering the market conditions. The demand for gold may increase as the global economies start to pick up again, which may, in turn, see prices rise, so you may wish to make your investment before this happens.
Keep An Eye On The Pandemic
How the pandemic is dealt with throughout the world will ultimately have a significant impact on the value of gold, and if everything goes well, it may mean the price of gold falls. As the world starts to open up again, investors are more likely to favor riskier investments with potentially higher yields, which may see the price of gold fall.
If you invest in gold, remember that it is a long-term investment, so keep an eye on the price of gold by all means, but do not worry about any ups or downs.