Jesus Ayala Photography/Getty Images
Interest rates are falling and could fall again in the months to come.
That was the big economic news this week after the Federal Reserve issued its first cut to the federal funds rate in more than four years. Borrowers saddled with higher rates on everything from personal loans to mortgages can potentially see some economic relief now. But what should investors do in this changing rate climate?
In recent years the clear answer has been to invest in alternative assets like gold.
That made sense due to the precious metal’s ability to hedge against inflation and diversify portfolios. As such, gold investing hit an 11-year high last September. But is this still the right move now as interest rates fall, particularly for those leaning toward buying gold bars and coins? Below, we’ll break down why it could still be a smart move even in today’s changing rate climate.
Explore your top options and get started with gold investing today.
Should you buy gold bars and coins as interest rates fall?
In short, gold bars and coins are a good investment in most markets, even in the current cooling rate climate. Here’s why they’re still worth buying now:
A rising price
It’s always smart to get invested in a growing asset before it becomes out of reach. And right now is the time to do so with gold. The price of gold has broken numerous price records so far in 2024, surging past the original $2,063.73 per ounce it started at in January to close to $2,600 per ounce now. Many experts are predicting a rise past $3,000 per ounce soon, making it a lucrative option for investors. With the price of the precious metal largely unaffected in the 24 hours after the first rate cut of 2024 was issued, it makes sense to buy in now before the price becomes prohibitive.
You may be able to get a discount if you buy gold in bulk now, taking advantage of the potentially increasing prices in the near future.
A tangible asset
Gold bars and coins are unlike most other investments in that they’re tangible and can be viewed, held, stored, and inspected by investors. This physical aspect provides a sense of security and stability, especially during uncertain economic times. In a climate where other assets such as stocks, bonds, and real estate may react unpredictably to changing interest rates, gold bars and coins offer a tangible asset that is easy to store and sell. They provide simplicity and ease of access, which can be advantageous amidst market fluctuations.
Portfolio diversification
Market volatility and the impact of interest rate changes can create uncertainty in the investment landscape. Portfolio diversification becomes crucial in such times to mitigate risks and safeguard investments. Gold bars and coins are considered a reliable option for diversifying a portfolio, as their value tends to remain stable or even increase during times of economic turmoil. Considering the current geopolitical tensions, upcoming U.S. presidential election, and potential consequences of recent rate cuts, diversifying your portfolio with gold bars and coins can provide a hedge against market uncertainties. However, it’s advisable not to exceed the recommended 10% threshold for gold investments to maintain a balanced portfolio.
The bottom line
While gold investing has been a prudent choice in recent years, the current economic climate still supports investing in gold bars and coins, even as interest rates fall. By capitalizing on the rising prices, tangible nature, and diversification benefits of gold, investors can position themselves strategically for potential gains and stability in their investment portfolios. Choosing to invest in physical gold assets amidst evolving market conditions allows investors to navigate market uncertainties with a valuable resource at their disposal.
Have more questions? Learn more about investing in gold here now.
Jesus Ayala Photography/Getty Images
Interest rates are falling and could fall again in the months to come.
That was the big economic news this week after the Federal Reserve issued its first cut to the federal funds rate in more than four years. Borrowers saddled with higher rates on everything from personal loans to mortgages can potentially see some economic relief now. But what should investors do in this changing rate climate?
In recent years the clear answer has been to invest in alternative assets like gold.
That made sense due to the precious metal’s ability to hedge against inflation and diversify portfolios. As such, gold investing hit an 11-year high last September. But is this still the right move now as interest rates fall, particularly for those leaning toward buying gold bars and coins? Below, we’ll break down why it could still be a smart move even in today’s changing rate climate.
Explore your top options and get started with gold investing today.
Should you buy gold bars and coins as interest rates fall?
In short, gold bars and coins are a good investment in most markets, even in the current cooling rate climate. Here’s why they’re still worth buying now:
A rising price
It’s always smart to get invested in a growing asset before it becomes out of reach. And right now is the time to do so with gold. The price of gold has broken numerous price records so far in 2024, surging past the original $2,063.73 per ounce it started at in January to close to $2,600 per ounce now. Many experts are predicting a rise past $3,000 per ounce soon, making it a lucrative option for investors. With the price of the precious metal largely unaffected in the 24 hours after the first rate cut of 2024 was issued, it makes sense to buy in now before the price becomes prohibitive.
You may be able to get a discount if you buy gold in bulk now, taking advantage of the potentially increasing prices in the near future.
A tangible asset
Gold bars and coins are unlike most other investments in that they’re tangible and can be viewed, held, stored, and inspected by investors. This physical aspect provides a sense of security and stability, especially during uncertain economic times. In a climate where other assets such as stocks, bonds, and real estate may react unpredictably to changing interest rates, gold bars and coins offer a tangible asset that is easy to store and sell. They provide simplicity and ease of access, which can be advantageous amidst market fluctuations.
Portfolio diversification
Market volatility and the impact of interest rate changes can create uncertainty in the investment landscape. Portfolio diversification becomes crucial in such times to mitigate risks and safeguard investments. Gold bars and coins are considered a reliable option for diversifying a portfolio, as their value tends to remain stable or even increase during times of economic turmoil. Considering the current geopolitical tensions, upcoming U.S. presidential election, and potential consequences of recent rate cuts, diversifying your portfolio with gold bars and coins can provide a hedge against market uncertainties. However, it’s advisable not to exceed the recommended 10% threshold for gold investments to maintain a balanced portfolio.
The bottom line
While gold investing has been a prudent choice in recent years, the current economic climate still supports investing in gold bars and coins, even as interest rates fall. By capitalizing on the rising prices, tangible nature, and diversification benefits of gold, investors can position themselves strategically for potential gains and stability in their investment portfolios. Choosing to invest in physical gold assets amidst evolving market conditions allows investors to navigate market uncertainties with a valuable resource at their disposal.
Have more questions? Learn more about investing in gold here now.
