As the Recession worries are getting Strong & Countries are printing more money, People are considering buying Gold as an Investment.
In this post we can explore the Pros & Cons of Gold Investment.
Advantages of Gold
Gold have the following Advantages.
- Gold is Less Volatile – More stability in price
- Gold is God’s Money – Not created by human
- Gold has Utility Value – As Ornaments
- Gold have Money Attraction capabilities – It is spiritual
- Gold can back Currency – as a Store of Value
These are some essential points which makes Gold a precious metal in people’s life.
Drawbacks of Gold
One should consider the following Drawbacks too:
- Gold has No underlying Company – No employees, No managers are working for it
- Gold has No financial statements – You cannot calculate Growth Value other than the Production Cost
- Gold itself does Not have growth – Its growth depends on underlying economy
- Gold is Not easy to store – Physical gold requires Locker to store
Note: Gold ETF is a good way of investing in gold but Not all ETF are gold backed!
Gold as a Hedging Instrument
However Gold can be used as a Hedging Instrument!
Gold is one of the few assets which increase in price during a recession!
During recession we can see the Stock Prices decline, Countries will be Printing more money, Inflation increases, Currency value decrease, Gold value Increase!
This is the reason more & more people are attracted towards gold during recession times.
So let us warn you, Gold is not good to be Invested because:
- Gold already appreciated a lot in the past 5 years
- You will not Gain even if Gold moves up 50% in next 2 year as:
- After 1 year when the economy recovers people will Switch from Gold to equities.
- So the value of Gold will depreciate making the total ROI around 30%
- So the real ROI per year you may get will be less than 15% for a 2 year period
So Gold is not worth to be invested now – or at-least fully!
Gold for Utility
However I will not discourage buying gold for Ornament or Marriage purposes as they are meant to be Held for a Lifetime – hence the price fluctuations will not be a problem.
Alternative Strategy based on Gold
However, there is an Alternative Strategy which can give you up to 500% returns in next 1-2 years using Gold!
We did this strategy during 2015 & It gave 1000% returns in 5 years!
We are repeating the same strategy – The strategy is Investing in Gold Loan Companies.
It is because If Gold go up 10% – then the Gold Loan Companies Stock go up by 30%!
How Gold Loan Companies works?
Gold Loan Company will take Gold as Collateral & Provide Cash to the Customers up to 75% of the Value.
If the customer cannot pay back the Interest or Principle on time, Company sells the Gold in Market Rates & Recover the money.
If the Market Value is higher than Pledging Times, the Gold Loan company gains more profits.
So during the recession times:
- People will need Cash & Pledge their Gold Ornaments & Gold Assets.
- Recession causes Customers to Defaults on Loan Payments
- So the Gold Loan company will Sell the Gold Collateral to Recover money
- It will be more likely that the Recession time pushed the Gold Price higher & Yielding more profits for the Gold Loan Company!
So this is the core strategy which all eagle-eyed investors like in Gold! Top HNI investors are using this – We work with them hence we know!
However be warned that you should know accurately:
- Which are the Gold Loan companies to buy now?
- What would be the best Entry Price?
- How much Capital you should invest?
- How long you should hold them?
These questions requires serious calculations, expert opinions, on-going tracking.
Note During 2015 we had released a Gold Stock which yielded 1000% returns till 2020! We are now releasing a similar Gold Stock
This is a Paid Report (Rs. 499 only) given to Recession Strategies Investor. We will be releasing 3 stocks under this strategy. Those who wanted to Gain from the Recession ahead, as well as Hedge against Losses can make use of this strategy.
As the Recession is for Sure, Futurecaps Advisor team has already invested in this Gold Loan company- So that assures the Real Potential of this stock.
Note: 3 Year Paid Subscribers will get this recession report free. We would endorse you to join this 3 Year Plan which will give you 15 multibaggers, 3 recession stocks & Recession guidance for your Career & Portfolio.
Convert Problems to Opportunities – As long as you did not caused IT!
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