One Chart Explains Why You Should Buy Gold Today
On Bloomberg Television, Monday morning, one of the guests made a comment to the effect that gold wasn’t as good an investment as stocks. I yelled at the television.
I often hear people repeat the idea that gold isn’t an investment … that investors are better off in equities. I disagree.
Every investor should hold some gold in their portfolio. It’s a great hedge against a collapse in the market. In this environment of ever more paper money, gold has a place in your portfolio today.
The chart below explains everything you need to know about why you should own gold. It puts the current bull market into perspective.
This is a chart of the price of gold (black line) versus the S&P 500 (red line). As you can see since 2000 gold has returned 350%. The S&P 500 is up just double digits.
Gold is an easy thing to own and store. Buy some, stash it in your safe-deposit box and let it protect some of your portfolio.
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Make sure you buy real gold and hold it. The issue is many buy paper gold which is bad if it doesn't rise and potentially terrible if it explodes upwards because you may be holding contracts that may not be any good given they are not backed by a full amount of gold and in some cases, little to no gold. Thus the disconnect between gold and gold prices that are suppressed by a growing amount of paper gold that outstrips real gold.