Diversifying your portfolio is an excellent way to hedge against volatile economic conditions. Purchasing precious metal investments and placing them in an IRA may allow you to protect yourself during an uncertain economy. Commodities, such as gold and silver, may outperform stocks if the stock market turns lower. Having them in your portfolio can combat this type of move.
Provides Diversification
While it can be beneficial to hold stocks over the long-term, it does place all of your funds in one investment vehicle. Having this type of exposure may decrease the value of your portfolio substantially if the share price of specific stocks falls or the economy takes a hit. Precious metal investments can help diversify your portfolio and act as a hedge against this type of risk.
Gold May Outperform Stocks
The stock market has suffered significant declines several times in the past during downturns in the economy. Protecting yourself against these types of moves is essential, especially if you are nearing retirement. Placing precious metal investments in an IRA should help you fight against this potential threat. During a crisis, precious metals have been known to increase in value.
It’s Physical
Stocks, mutual funds, bonds and ETFs are paper assets. Holding one or more gold coins physically in an IRA may act as an insurance policy against these paper assets. Using a self-directed IRA offers you complete control of your portfolio and allows you to utilize physical gold and silver coins as an investment vehicle. Adding them to any portfolio is usually a wise choice.
