Consider this, if you’d bought £55 of gold every month for 18 years from 2002, you would have over £28,000 of gold by 2020. Compare that with putting the same amount into a 3% cash ISA – £15,703.51 – or simply setting it aside with no interest at all – £11,880. When it comes to investing, spreading risk helps to avoid overexposure to any one particular asset class. Many experts, as well as little, old, me suggest putting around 2–10% of your portfolio into a safe haven investment such as gold. Now these percentages can vary, depending on how strongly you feel about the future of fiat currency and what part you think precious metals will play on the money of the future.
While gold is always at the forefront of precious metals investment, I'm a bigger silver fan, and I am definitely heavier on the white shiny metal than the yellow stuff. I see silver exploding and bursting in to life very soon, but for now we are grinding slowly higher. I think that for now this slow and steady increase makes quite a bit of sense as central banks around the world continue to loosen monetary policy regimes that they are in. This means that people are starting to look for other ways to preserve their wealth, as fiat currencies lose value. Because of this, I think it provides a bit of a floor underneath the gold and silver markets, so I do like the idea of picking up silver while it's still “on the cheap.” I do believe that traders will continue to look at silver as a bit of a mixed bag though, because silver also has a significant industrial component built-in as well. After all, it is used in a lot of manufacturing.
Silver is traditionally perceived as the poor cousin of gold, and silver prices usually move in tandem with gold. However, silver has outperformed its yellow counterpart this year. During times of volatility silver prices rise faster than gold, like now, while over longer periods gold will never see you short.
Deciding what's best for your portfolio is something I can't help you with, but what I can help you with is getting you to think about adding precious metals to your collection. There is no such thing as a bad precious metals investment.....
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