Gold is never unfashionable: 5 reasons to buy gold in 2016

Gold is never unfashionable: 5 reasons to buy gold in 2016

08.07.2016

A reliable investment tool. A highly liquid asset. A precious metal. All these are gold's features, a symbol of power and high status.

Will gold ever be unfashionable? Nowadays, gold prices are on the rise. Find out 5 reasons why to buy gold in 2016!

Gold has been a coveted product for thousands of years. Any other metal or asset is less likely to have gold's stability. Gold is, in fact, the most popular time-tested metal. Do you want to know why gold is actually full of records this year?

Stratospheric growth of gold prices

Statistics and graphs of gold prices are really striking this year. On July 6th, gold reached the incredible value of $ 1374 per ounce! And it does not seem to go down. Do you need more reasons to decide whether to buy gold or not? More of them below.

 

Five reasons to buy gold in 2016

- Inflation

Gold has always been a perfect hedge against sharp drops of money's value. What is the consequence of having gold reserves in those situations? Gold prices rise and sometimes even outrun inflation, which saves gold holders from money depreciation.

- Gold against dollar

Charts of gold prices and the US dollar are closely interwoven: when gold rises, the dollar falls, and vice versa. Since currencies are subject to rapid changes and influenced by many political and economic factors, the risk of loss is high. Unlike money, gold holds the position of safe-haven asset.

- Uncertainty

Gold is often called the "crisis commodity," because people take refuge in its safety in times of world tensions and geopolitical disturbances. This precious metal frequently overtakes other investments in terms of stability. Gold has proven to be trustworthy since it protects against inflation.

- Low supply but high demand

Over the past fifteen years, gold-mining activities have significantly decreased, which results in a reduction of the total supply of gold in the international market. This trend together with the high demand leads gold prices to rise. Gold's demand is furthermore strengthened by global central banks cutting sales of gold bars.

- Diversification

Financial safety is based on finding various investments. Properly diversified investment portfolios combine gold with other assets, bonds and commodities in their portfolio to avoid the overall market volatility and risk-taking. 

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