Gold offers a safe-haven investment in times of crisis that has been reflected lately by investors bidding up the price of the precious yellow metal.
The rise in gold prices seems to have been caused by a combination of negative interest rates in Europe, soaring government debt, trade wars, economic weakening and global conflicts rather than a specific economic disaster such as the Great Recession of December 2007 to June 2009. Nonetheless, the traditional use of gold to provide a safe-haven investment in times of crisis is evident when comparing the price of precious metal funds to equities.
A chart for the past 12 months shows the prices of SPDR Gold Shares (NYSE:GLD) and the iShares Silver Trust (NYSE:SLV) soaring well above the gains of the Dow Jones Industrial Average, the S&P 500 and the NASDAQ. Gold and silver endured a bear market in precious metals between 2011 and 2018 before jumping in value over the past year. During the last 12 months, GLD jumped 25.54 percent and SLV soared 23.36 percent, while the Dow Jones Industrial Average eked out a 1.01 percent gain, the S&P 500 topped the break-even mark by just 0.35 percent and the technology-heavy NASDAQ fell 2.04 percent.
“The whole sizzle of hard assets investing is that you’re diversifying away from the whole world of paper securities into an age-old reservoir of value,” said New York-based money manager Hilary Kramer, whose new 2-Day Trader service has notched nine consecutive profitable trades since its recent launch. “Companies can fail. Brokerage systems can get hacked. And while it’s rare, fiat currencies can collapse. That’s why I ignore SPDR Gold Trust (NYSE:GLD) and go straight to funds like Sprott Physical Gold Trust (NYSE:PHYS).”
Paul Dykewicz interviews Hilary Kramer, whose new 2-Day Trader service is 9 for 9 in recommending profitable trades averaging 13-percent returns since its launch.
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Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce,Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. Follow Paul on Twitter@PaulDykewicz.
