Gold is one of the oldest traded assets. It existed long before the creation of the financial markets. In addition to its stability, the yellow metal is attractive because it has become a mainstay of the money markets. International tensions and periods of recession play an important role in the fluctuation of the gold value.
During national or global crises, gold prices and quotations often fluctuate upwards. Gold thus becomes a way for investors to protect themselves against economic and geopolitical fluctuations.
Precious metals : an ideal investment as a store of value
The price of gold rose sharply between 2000 and 2023, demonstrating investors' confidence in this precious metal. Even in these uncertain times, the price of gold continues to rise.
Many private investors and traders are also particularly fond of gold, as this shiny metal offers a wide range of potential returns. As a safe haven in times of uncertainty or financial crisis, investors are turning to precious metals on a massive scale to protect their assets from market fluctuations.
When demand for gold is high, its price is boosted, hence its proven reputation as a reliable asset, a metal that every country holds a large reserve of.
The evolution of the gold price in the face of recession
For several decades, demand for the yellow metal has grown considerably. The reason for this is changing purchasing power, particularly in emerging countries, which have set their sights on this precious metal.
The main attraction for investors is the steady rise in its price. Gold can therefore boast of being a durable asset. The biggest rise in its price came during the 2008 crisis. Against the pound sterling, the price of gold almost doubled. The precious metal also performed surprisingly well during the Covid crisis19 .
Gold acted as a shock absorber for some investors, who wanted to protect themselves from the financial consequences of the fall in their other assets, which led to an initial fall in its price. At the same time, other private investors were buying up yellow metal en masse as a precautionary investment, leading to a spectacular rise in its price.
What's more, in the face of all these crises, yellow metal has become a genuine store of value, as it has a negative correlation with equities during periods of recession. According to experts, an exemplary investor should divide his investment funds into four parts, with each part invested in more or less risky sectors : equities, government bonds, cash and gold.
As gold is detached from inflation risks, it helps to counter a potential fall in equity returns in times of crisis. When volatile assets could collapse, gold acts as a safety net.
The different ways of investing in physical gold
Physical gold is one of the best ways to diversify your assets and protect your savings.
Investing in gold offers a number of investment advantages, including the possibility of improving the overall performance of investment portfolios for all investors, while giving them a degree of stability and security in their asset portfolios.
Gold can be presented in a variety of forms :
Gold bullion coins
To fall into the category of investment gold coins, a coin must meet a number of criteria:
- It must be legal tender in its country of origin,
- It must have been minted after 1800,
- Have a purity equal to or greater than 900 thousandths,
- Be quoted at a premium of 80% or less, in addition to the value of the gold metal.
So they have many qualities. As well as being easy to store, they are a good way of diversifying your investments. They are becoming increasingly rare and are selling for more than they are worth.
The best known and most sought-after is the 20 Francs or Coq Marianne. It is an emblematic coin, a vestige of the period when the gold franc shone in Europe.
Modern gold coins
Modern gold coins embody history, art and financial value. These coins, minted with meticulous precision, have become objects of fascination for collectors, investment tools for discerning financiers and symbols of prestige for those who own them.
One of the most striking features of modern gold coins is their exceptional aesthetic appeal. Coin designers strive to create designs that tell a story, celebrate culture or embody a nation's values. Whether it's a American Eagle or a Chinese Panda with a bamboo panda, each coin tells a unique story.
However, these coins are not simply collectors' items. They are also investment instruments. Their value is generally linked to the price of the yellow metal itself, making them a way of diversifying a financial portfolio. Investors often choose gold coins because of their liquidity, ease of transport and worldwide recognition as a store of value.
Gold bars and ingots
Gold bars have been coveted precious metals for centuries, and their appeal continues today as a solid, tangible investment.
They generally range in weight from a few grams to several kilograms. These ingots are produced by accredited gold refineries, which follow strict standards to guarantee their purity.
One of the main advantages of gold bars and ingots is their stability as an investment. Gold is a tangible asset that has stood the test of time. In times of economic uncertainty and financial crises, gold tends to maintain its value, or even increase.
One example is the 100-gram gold bar, which is made of fine gold and its purity of 999.9/1000 (24 carats) makes it one of the most sought-after precious metals in the world.
It stands out for its flexibility, with excellent protection for your assets and a good return on investment.
As a result, the price of gold has risen spectacularly, despite the periods of recession caused by the crises. Economic forecasts are confident that the price of gold will continue to rise over the next few years. The yellow metal is therefore the most reliable investment on the markets in times of economic fluctuations.
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