At the start of 2024, many Americans were optimistic that inflation was permanently cooling and relief would soon be on the horizon. Unfortunately, that hasn’t been the case in the first quarter of the year, with inflation reports in January, February and March disappointing for many. Now, after inflation increased in the last two months, many are wondering if interest rate cuts will come at all this year. But what should investors do amid this uncertainty?
To get the most of out a potential gold investment now, however, investors should take certain steps. Below, we’ll break down three smart gold investing moves to make with inflation rising.
3 smart gold investing moves to make with inflation rising
Here are three moves investors should consider making today with inflation still problematic.
Get started
You can’t obtain the benefits of gold without first being invested, so don’t hesitate to get started now. The price of gold has risen by hundreds of dollars in the past month and currently sits at $2,332.18 per ounce. So if you wait much longer, the price could become prohibitive and you may wind up getting priced out. Plus, with inflation as high as it’s been, it makes sense to add a timely benefit to your portfolio now to offset the corrosive effects inflation may have had on some of your other assets.
To reap the benefits of any investment it’s vital to understand what it can and can’t do. This is particularly true for alternative assets like gold. While gold can be an effective hedge against inflation by maintaining its value when inflation erodes the purchasing power of your money — and it can diversify a portfolio otherwise made of stocks and bonds — it’s not a traditional income-producing investment. So don’t invest expecting to make a quick profit. While that could, in theory, happen now with the price volatility, it’s not something that investors should consider as a feature of their gold investment.
Don’t overinvest
While gold is a smart investment right now, investors should understand that there’s a limit to how much they can benefit from the precious metal. Many experts advise limiting a gold investment to 10% or less of your overall portfolio, thus allowing other assets like stocks and bonds to grow as needed. The range between 1% and 10% of your portfolio, however, will depend on your specific investor profile and your long-term goals. Just be careful not to overinvest, as the benefits of gold could overshadow other income-producing assets.
The bottom line
With inflation on the rise again and investors looking for some additional ways to grow and protect their money, many may want to turn to gold now. It makes sense to get started quickly as the price is rising and, without it, your portfolio could more negatively be impacted by inflation. Just make sure to understand the income-producing ability of gold and don’t be tempted to overinvest. But by making these three smart moves today investors will improve their chances of gold success, both now and in the months to come.
Matt Richardson is the managing editor for the Managing Your Money section for CBSNews.com. He writes and edits content about personal finance ranging from savings to investing to insurance.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
