Few people in the West today hold any gold and few advisers suggest that their clients should include gold as part of a diversified portfolio. Knowledge on the role that gold played as money and as a means of exchange in history is extremely limited. Degree courses in economics have little or no reference to explain why gold rose to prominence as money and how it was removed as the mainstay of a Sound Monetary System. To understand gold and its unique historical role and the current relevance of gold it is necessary to undertake extensive research and seek out answers to questions that, once obtained, are surprising.
However, we would summarise the key reasons for holding gold as part of diversified portfolio as follows:
Further consider the following facts:
We would conclude that gold is the best form of money and will again, in due course, be re-monetised as part of the Special Drawing Rights via the International Monetary Fund. Holding some gold in the form of coins or bullion in LBMA recognised secure vaults offers the ordinary citizen the best hedge against another financial crisis.
How do you hold gold and in what form? It depends upon your circumstances and personal financial position. Ideally in Britannia one-ounce coins in an offshore vault through an LBMA accredited broker. Don’t hold it at home.
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Risk Warning: Please note that the following are the author’s personal opinions and should not constitute investment advice.
If you are keen to understand more, call a member of the team on 01494 683100