Investors invest in gold for many reasons, as it has every attribute that would make that commodity a good counterpoint for its traditional securities like stocks and bonds. They also perceive gold as a store of value, even though it has an asset that would not produce a cash flow. Some might even see gold as a hedge against inflation, like near-zero interest rates and government spending, which have sent inflation racing much higher.

Investors have more emotionally satisfying ways for investing by achat or Geneve as in bars or coins. They will have more satisfaction in looking at it and even touching it, but the ownership of gold has serious drawbacks, too, if one owns more than a little bit. One of its most significant drawbacks is greed to need to have it safeguarded and always insure for all the physical gold. That is the main reason that people vente or Geneve.

What are the advantages?

With all the drawbacks, its most significant advantage is using it as the future to invest in gold, being an immense amount of leverage that anyone can use. In other words, they can also own a lot of gold as their future securities for a relatively small sum of their money. If gold investments move in the direction one may think, they can make cash much more frequently and quickly.

With all the gold performance, sometimes, it is not likely much clear when one purchases it. Since gold by itself never produces frequent cash flow, it is always challenging to determine when it’s cheap. It is not the case with all the stock, where much clearer signals are mainly based on the company’s earnings.

Moreover, as gold never produces any frequent cash flow to make a profit on gold, investors must always rely on someone else that has been paying more for its metal than they have to. In contrast, its owners, including a gold miner, can profit not just from the rising price of gold but even from their business increasing its revenue. So there are multiple ways to invest and win future securities with gold.

Final words

Investments in gold are only meant for some, and sometimes the investors get struck by placing their bets on cash-flowing businesses rather than simply relying on someone else to pay more for their shiny metal. That is one of the reasons that legendary investors consider investing in gold and instead advocate buying for cash-flowing businesses. Plus, it is a much simple way to own the stocks or funds as they are always highly liquid, so one can quickly convert their position of gold to cash if they ever need to.