People who own gold and people who invest in the stock market have fundamentally different goals.
Gold owners are protecting a proportion of their wealth in a form that is physical, in their possession, and will always hold value.
But here is the funny thing…
Gold owners can often beat investors at their own game.
Gold owns buy their gold and store it. A particular gold coin or bar could remain in their possession for decades. Many gold owners also practice an investment strategy called dollar cost averaging. That is to say, they keep buying gold, at regular intervals, whether prices are rising or falling. They don’t mean to use an “investment strategy”. It’s just how they keep adding to their store of gold.
Investors are often buying and selling in the hope of catching the “big one”. But in the process they are incurring fees and other costs every single time they buy or sell.
Gold owners pay fees once when they buy. Investors pay fees far more frequently, and as a result can significantly eat into their profits, if there are any profits.
Over the last 10 years gold prices have increased by over 400%
If you find an investor who has achieved the same growth, he or she still hasn’t done as well as the gold owner.
The gold owner has to deduct just one fee from his profit total.
The investor has to deduct dozens or even hundreds of fees from his profit total, depending on the number of times he has bought and sold over the last ten years.
So pause for a moment, and perhaps reconsider how much money you should have invested in stocks, and how much you should have in physical gold.