Considering the state of our economy after the banking and housing crisis, it is no wonder that investors are touting precious metals investing as a way to protect your assets. Given the rumors of fraud that swirled around the world of financial consulting, many investors had to re-think their entire money making strategy. It became clear that stocks and bonds were soon to become an investment of the past, and precious metals would come again to the forefront of the investing world.
Investing in precious metals is definitely not a new concept in the financial markets. While paper currencies would decrease in value, it was well-known that precious metals investing would continue to hold their value. When comparing the markets, anytime paper currency was down, precious metals were up!
Gold – The Most Popular Precious Metal
In times of currency volatility, gold has often been a growth investment that many investors see as a continuing trend. While varying economic factors play against one another, many investors see gold as a solid investment in times of financial strife. Depending on when they decided to invest, some were even able to see a return anywhere from three to five times their initial investment.
The Silver Lining
Given the recent volatile economy, silver has often seen itself coming out on top in the world of precious metals investing. Although silver often places second against the more popular gold, some experts agree that silver has more money making potential than its yellow metal counterpart. The main reasoning behind this lies in the gold to silver ratio.
The steady price ratio of gold to silver comes from the fact that while gold fluctuates in value, silver generally stays the same. This means that in the coming future, investors expect an increase in the worth of silver on the market. The confidence in silver given by these investors is exactly why silver will continue to gain ground in the world of investing.
All that Glitters
While most people only think of silver and gold when it comes to precious metals investing, platinum, titanium, and copper should definitely not be ignored. Because of their industrial and medical uses, gold and silver will always be able to maintain their value on the market. However, investors shouldn’t forget the uses readily available for these three precious metals. While the markets for these other precious metals aren’t as easy to get into as gold and silver, they can often prove much more lucrative for investors. Because of this exclusivity in their market, they can be less volatile of an investment.
Getting Started with your Investment
While there are several different ways to invest in the precious metals market, some say the safest way is to invest in the actual bullion of the metal. However, with the unstable economy of the U.S., the government has limited the amount of direct access the public has to this bullion. So, while it may be the smartest way to get started in precious metals investing, it is something to be considered.
Investors also have the option of going through an exchange-traded fund, or ETF, which has the benefit of holding the value of gold and silver. The problem with an ETF is that they are listed on the stock exchange, so they have the same risks associated with other paper securities on the stock market. Investors also have the option of investing in a mining company, which can be quite lucrative. The only problem there is that investors often are at the mercy of the business itself and can fall prey to mismanagement.
For anyone wanting to get into precious metals investing, they should be aware that economic factors can greatly affect the outcome of their investment. In some cases precious metals have been known to move with an upswing in the paper currency market, and in others they have moved in the opposite direction. Being aware of their history can help prepare you for your future in precious metals investing.