Why Buy Gold And Silver?

    Published: 06-16-2009
    Views: 9,828
    Michael Maroney from Monex Deposit Company discusses how to determine if owning gold and silver is right for you, and why you should own gold and silver.

    Michael Maroney: Hi! My name is Michael Maroney from Monex Deposit Company. Today, we would like to discuss how to determine if owning gold and silver is right for you, and why you should own gold and silver. First, let's talk about the different places that you can actually invest. If you look at the investment community, there are really only four places in which you can park your money; one, the real estate market; two, stocks and bonds; three, hard assets; and four, cash. Most people will tell you that the trend of the market should be your friend. If you look at the real estate market right now, the trend is somewhat negative. If you look at cash, cash has become trash as the banks are paying less than 1% on CDs. If you look at the stock and bond market, they've been somewhat neutral over the last three years. But if you look at the hard asset or precious metals market, they've been the number 1 performing asset class in the world on average for the last ten years. Every financial analyst will tell you that you should have a diversified portfolio. The old saying, never put all of your eggs in one basket, is definitely something that every investor should listen to. Diversification has always been a key. If you look at the precious metals markets today, they're a non-correlated asset that will allow you to feel safer as far as all of your investments are concerned. No one has a crystal ball, and when you have numerous investments in different sectors if one sector goes down, the other sector potentially can go up. Modern portfolio theory states that a minimum of 9.

    5% of your portfolio should be held in gold or another non-correlated asset such as silver. This way if all of your other assets go down in value, these types of assets typically perform better and allow you to have a quality hedge built into your portfolio. Investors around the world have become extremely concerned with the value of currencies in general. Now that all currencies have become fiat in nature, the governments around the world are basically printing money in order to stimulate the economy. Gold has been the number 1 performer as the US dollar continues to fall. The reason investors today are so excited about owning gold is it is one of the easiest assets in the world to buy or sell, and it is very easy to store. The beautiful thing about owning gold is that it is one of the best asset classes because it is the ultimate onshore asset that remains off balance sheet. It allows the individual investor to actually possess wealth that will hold its value in this type of economic environment.