Gold is being respected as a metal, and is being valued for generations. That is why most cultures have recognized gold for several years now. The coins containing gold came around 650 BC, and then through centuries people have continued holding on to gold for various reasons.
These days, gold is considered to be an asset. No matter if they are physical gold (like jewelleries, bars, and coins) or gold stocks – they always come to rescue when one is under financial dire. This is the metal whose price keeps changing every day. In most days, gold market is on the rise. One can look at the gold rate today Chennai or in other cities before buying them or investing in them.
It is a precious metal, and hence considered to be a unique property. They look beautiful unlike other elements because they absorb some light creating that color.
Here are some major reasons why one must invest in physical gold or gold shares:
- It can weaken the US Dollar. The US Dollar is said to be one of the most important reserve currencies of the world. But there are some rare cases where the value of the dollar falls against other currencies. This prompts many people to flock to the security of gold that raised the prize of the metal. In 1998, when the value of dollar got lowered, the price of gold tripled nearly.
- Gold has always been an excellent hedge against inflation. This is because; its price tends to rise when the cost of living also increases. According to investors, the gold price soar, and the stock market plunge during the time of high-inflation years. It is because – the flat currency loses its purchasing power to inflation. Gold has a good store value as well, and so people are more encouraged to buy gold when they see that the local currency is losing value.
- They also provide protection from deflation. It is defined when the price decreases, the economy is burdened by excessive debt. When depression in the money market happens – the relative purchasing power of gold soared high. This is because, people chose to hoard cash, and investing them in gold coins, and bars are the safest.
- Gold retains its value not only during the time of financial crisis, but also during the timer of geopolitical uncertainty. This is also known as the ‘crisis commodity’ because people went to their relative safety when the world tension rises. During these times the gold can perform really well as investments.
These days, most people have shifted from investing in physical gold, and are more comfortable in investing in the gold-based derivatives through stock exchanges, and also as a commodity. No matter how bad the situation is – people will always buy gold in a country like India, and that is a steady investment. One can look at 5paisa to check the rise or decrease in the pricing of gold daily as it fluctuates often. Knowing the price beforehand always helps them.