Is Gold a Good Long-Term Investment in 2019 and Beyond?
As the global market experienced unprecedented changes and uncertainties in 2019, particularly due to the outbreak of the Coronavirus, many investors turned to gold as a secure haven. I myself started investing in gold during mid-2019, and the results have been promising with an increase of around 12% compared to initial investments. However, it's important to note that while gold is a wealth preserver, it may not be a wealth creator in the long run.
Why Gold is Considered a Good Investment During Uncertain Times
Given the current global economic conditions, forecasters are predicting that gold prices will continue to rise amidst precarious times. With worldwide share markets experiencing reduced value, the demand for gold as a safe haven has grown. This trend is not unexpected, as gold has long been regarded as a hedge against inflation and market volatility. As V a prabhu eloquently put it, it is crucial to allocate a portion of your investible surplus to gold, with a recommendation of around 5 to 10% in your overall investment portfolio.
Historical Context and Future Outlook
Throughout history, gold has consistently shown its strength as a long-term investment. The yellow metal tends to perform well during periods of geopolitical uncertainty and economic instability. Analysts predict that gold trends will continue to rise, influenced by various local and international factors. A prime example of this is the bull market that has been witnessed on the Multi Commodity Exchange of India (MCX), where gold trends have been trending positively.
Strategic Investment Approach
To invest in gold effectively, a systematic approach is recommended. Systematic Investment Plan (SIP) is a flexible method whereby small investments are made regularly and consistently, regardless of market conditions. This strategy can help you accumulate gold without the need to predict market movements. Consulting with a financial advisor or following in-depth market analysis can further enhance your decision-making process.
For those interested in technical analysis, V a prabhu has shared his insights on his YouTube channel, where he conducts detailed analysis of gold futures contracts on the MCX. His videos can provide valuable information and insights for those looking to make informed decisions about their gold investments.
Key Takeaways
1. Gold is a practical long-term investment that can offer stability and protection during uncertain times. 2. A portion of your investment portfolio should be allocated to gold, typically around 5 to 10%, to diversify and balance risk. 3. Investing in gold should be done using a systematic approach such as SIP.
By considering these points, investors can make more informed decisions about their gold investments and build a robust portfolio for the future. As V a prabhu suggests, the future of gold in terms of rising trends remains optimistic, making it a worthwhile consideration for any investor looking to hedge against market volatility and preserve wealth.