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Considering gold investments? These types of investors can benefit now

Your timeline, goals and existing portfolio can help you decide if gold is right for you. Busakorn Pongparnit/Getty Images

Ongoing inflation, rising interest rates and overall economic uncertainty may have many American investors reconsidering their portfolios this year.

Even beyond broader economic changes, reevaluating your priorities and risk tolerance when you reach milestones throughout life — like earning more in your career or nearing retirement — can be a good practice.

Always evaluate any new investment choice alongside your portfolio and goals to determine the right path for you. But for some investors in today's environment, there may be benefits to exploring alternative assets like gold. Gold, in particular, can be a unique asset that makes more sense in some portfolios over others. 

Learn more about gold investing with a free investor kit today.

Types of investors who can benefit from gold now

Here are three types of investors who may benefit from adding gold to their portfolios:

Investors who want to limit risk

If you want to see your portfolio grow over time, risk is an important factor to balance. The stock market, for example, is inherently risky — but it has also proven to increase in value over the past several decades.

However, having a mix of less-risky assets in your portfolio may be a good way to help mitigate that risk, especially if you want to play it safer given today's economic challenges.

Adding a small amount of gold can help limit the risk you're exposed to as an investor. In fact, it's been valued for its stability over time and for maintaining value even as inflation erodes purchasing power. While you won't see the exponential growth you might in other markets, gold can be a good way to keep some stability while you face volatility elsewhere.

Explore your gold investment options with a free information kit today.

Investors with long timelines

In general, younger people and new investors with decades before they need to access their investments can afford to make bolder investment decisions. The longer timeline gives them space to weather market changes and volatility before they need to use the money they've saved for retirement.

Because gold is a stable asset that can help investors weather downturns in the market, a long-term investment strategy means you can use gold as a stabilizer throughout the ups and downs of the market.

Just remember, gold may be safe but it's not the best way to grow your money over the long run. Consider investing a small amount — up to about 5% — of your overall holdings in alternative assets like gold, while you maintain a balance of other investments to maximize your growth.

Investors looking to diversify

Diversification is an important strategy for any investor — a diverse portfolio can help you get through periods of market volatility with assets that tend to rise or remain steady when others fall.

Gold is a good diversifier because it can have opposite reactions to other markets. For example, gold historically tends to maintain its value when the U.S. dollar drops during periods of high inflation. In some cases, it can even perform at an inverse of where the value of the dollar is. Gold can also keep your portfolio stable when the stock market is down. While the value of the S&P 500 fell overall in 2022, for example, gold's value not only remained stable but actually increased by a small margin in the same period.

Learn more about how gold can help you diversify with a free investment guide.

The bottom line

Gold has long been used by investors as a hedge against inflation and aa stable investment choice to balance riskier equities and other assets. Depending on your investment goals, adding a small amount of gold to your portfolio can help you weather the unexpected. 

Before you decide, evaluate your existing portfolio and your long-term goals to decide if gold is right for you, and explore the different options available for gold investors today — from gold IRAs to gold ETFs and even holdings of gold bullion. 

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