As people become more financially saavy, more and more are looking at expanding their financial portfolios with investments in metals. Among all the precious metals, however, gold and silver are the ones which have maintained their appeal over the years. Gold has long been proven to be a very stable asset with very great potential of increasing your wealth. Silver, on the other hand, is the world’s second most important commodity, next to oil. But, which is better – silver or gold investment?
According to the International Monetary Fund (IMF), the economic rollercoaster ride is expected to continue in the next few years. With that said, it is extremely important for all investors to first understand the current market conditions before making investments.
Investors who have no confidence in Dollars or Euros can find refuge in silver or gold investment. These two metals have survived the test of time and hence, are both generally safe investments for your wealth. But, of course, there are benefits and drawbacks to every investment project, and these two precious metals are certainly no exception.
The Pros and Cons of Gold Investment
Gold is the only money that has maintained a very strong position in the 5,000-year history of its utilization by mankind. This metal has proven in a lot of ways that it is the safest investment in times of economic turmoil. And since it is considered a universal currency, gold can be traded anytime and anywhere in the world. Here are some other facts that make gold a good investment.
- Gold is a very stable asset.
- Gold internationally recognized and valued.
- Gold offers a variety of investment opportunities.
- Gold is not affected by inflation.
- Gold is almost always highly in demand.
- Gold is durable.
Although gold is preferred by most investors who are concerned with collapsing currencies, it is not without risks. Here are the two major cons of gold investment.
- Gold is highly at risk of loss, theft or confiscation.
- Gold needs a highly secure storage place.
The Pros and Cons of Silver Investment
Silver is one of the most useful commodities in the world. It has innumerable uses in various industries because it is electrically conductive and thermally resistant. The benefits of silver are pretty much similar to the benefits of gold. Here are some of them.
- Silver is a relatively inexpensive metal.
- Silver is not generally affected by inflation, just like gold.
- Silver is highly in demand in industries like jewelry, electronics, coinage, imaging, water purification, etc.
Adding silver to your investment portfolio diversifies your assets and adds protection against the risks of other financial instruments. But, just like gold, silver has its own set of disadvantages.
- Silver is subject to tax due to its rarity and wide use in different industries.
- Similar to gold, silver is at risk of being stolen.
- Silver needs storage.
- Silver takes longer to liquidate.
Fiat currencies have weakened in recent years and have lost most of their buying power. Before paper money becomes a safe investment again, it has to recover its genuine value first. Meanwhile, investors can have alternatives in the form of silver or gold investment.
When money is fast becoming worthless, investors are better off going for real money, just like gold and silver.
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