Why Precious Metals Should Be in Your Asset Portfolio
There are different strategies that apply in asset protection depending on the amount of money you have in your portfolio. For instance, let’s say an investor has under $250,000 in assets and would like to protect it. One of the questions they tend to ask is whether they should add precious metals to his asset portfolio. The answer is absolutely.
The focus of Nagel and Associates is on asset protection, and there’s really no better store of value than precious metals. In fact, we are big fans of precious metals.
If you look historically for example at gold, 100 years ago an ounce of gold cost $20 and would buy a fine tailored man’s suit. Today, an ounce of gold will still buy a fine tailored man’s suit but it would cost $1,800. Gold holds its value through inflation, making it is a store of value for your portfolio.
There are many benefits of adding precious metals to an asset portfolio and different ways in which it can be done. An indirect investment in gold can be made through private equity funds or through an investment company that specializes in gold as a commodity. When an investor wants to liquidate the portfolio, the investment can be traded on the market quickly. But you don’t actually own the gold, you simply own gold stocks or EFTs.
A direct investment involves purchasing precious metals outright. While a minimum investment is almost always guaranteed, a market trade for the purposes of liquidation may take a little more time. But you have the advantage of owning the gold outright as a real, tangible asset.
An investment in precious metals is a great way to protect an asset portfolio from government currency manipulation. For example, currently, the United States government is printing money as they see fit. With the current budget deficit in this country, this unrestrained printing of money will cause inflation and the devaluation of the currency.
Fortunately, the government cannot print precious metals and precious metals are limited. Because the value of gold, platinum and silver cannot be directly manipulated by the government, precious metals hold their value and are not subject to the negative effects of inflation.
For investors looking to diversify their asset portfolio to withstand the growing concern of inflation and the devaluation of the dollar, we suggest that folks hold at least 10 percent of their net worth in precious metals. This allocation can improve performance while guarding assets against inflation.
At Nagel Law, we have the diversified expertise to create a stable offshore plan to protect your assets. We utilize many pecuniary strategies to protect your estate. Contact us today to discuss your financial options.