Page 22 - Introduction to investing in Gold

The Beginner's Guide to Investing in Gold
Firstly, I like to take a step back and look at my options. Take what I view as a 10,000-foot view of life. Here’s my thinking:
Bonds – inflation makes me nervous – I could end up losing purchasing power, and I’m also worried about currency movements.
Crypto – it’s relatively new, so it doesn’t have the kind of track record I’m looking for.
Equities – if we get a downturn, earnings are likely to be squeezed and targets missed. I can’t see how that’s good for share prices.
Property – higher interest rates make me nervous. I’ve also got a lot of money tied up in my own house.
Cash – I like to have some, but I’d be worried about inflation eroding its value.
Don’t get me wrong. I like to have a diversified portfolio, but gold has become a lot more important to me. What do you think? This is your money we are talking about!
This thought process pointed me towards gold. But that was just the start of the process. I wanted to take a closer look at the asset class it belongs to – I would say that’s commodities. I wanted to see where they are in their cycle (more on that later).
Here is the Goldman Sachs Commodity Index:
Source: Trading Economics 17