4 smart reasons to invest in gold this May
It's never a bad time to review your investments. But at the start of a new month – and against the backdrop of sticky inflation and elevated interest rates – this May is a critical time to do so. One investment that you may not have thought about is gold. Investing in the precious metal hit its highest point in more than a decade last year and the price of the metal has broken numerous records in recent weeks.
That noted, gold doesn't operate in the same ways that other assets do. And the benefits of the metal will be different than stocks and bonds. But that doesn't mean that gold can't still be valuable. It can be — particularly this month. Below, we'll break down four smart reasons you may want to invest in gold this May.
Start by exploring your top gold investing options here today.
4 smart reasons to invest in gold this May
Here are four reasons why it may be wise to invest in gold this month.
It can help hedge against inflation
Those who were hoping the downward trajectory of inflation that was noted at the end of 2023 would continue unabated in 2024 have been disappointed so far. Inflation ticked up in February and again in March (the April report will be released later this month). So inflation is still a concern for many.
But gold can help hedge against this by maintaining and potentially even growing in value when inflation is high. And, with the prospect of further cooling in the inflation rate unknown, it makes sense to add some precautionary measures to your investment portfolio now. Gold can help make that happen.
Learn more about how gold can help with inflation here.
It can diversify your portfolio
A diversified portfolio is often a successful one. And gold can help provide that diversity. While stocks and bonds can be more volatile and should make up most of your portfolio, gold can help, too. While the latter assets can produce income, gold can help protect it. That said, gold investing should generally be limited to 10% or less of your portfolio to maintain the growth potential of other assets.
The price is rising
The price of gold has surged this year, rising from $2,063.73 per ounce on January 1 to $2,306.10 per ounce today — a 13% rise. But with interest rates again on pause following a Fed announcement this week and inflation still problematic, more investors may pursue the yellow metal, thus causing the price to rise. It makes sense to get invested, then, before the price becomes out of reach. This May is a smart time to do so.
You may be able to turn a quick profit
Gold is not often thought of as an income-producing investment, but with the rapidly rising price so far in 2024, you may be able to turn a quick profit. This will require closely monitoring the price for opportunities to sell, but if you're looking for an investment that you can buy low and sell high, gold may be the one to pursue this month.
See how much you could potentially make from a gold investment online now.
The bottom line
The timing for any investment type is important to get right and the timing right now favors gold. By investing in gold you can secure a hedge against stubborn inflation and diversify your portfolio in the interim. And with the price rising, it's beneficial to act promptly. If you do, you may even be able to turn a quick profit — a rarity for an investment better known as a safe haven. As with all financial investments and considerations, however, be sure to carefully weigh the pros and cons of gold against other assets to improve your chances of investing success.
