Market analysts predict a correction is right around the corner, hurting shareholders across the globe. Some expect a standard pullback that could turn into new peaks a few years later, and others expect a collapse on the scale of 2008, with a long bear market to follow. Every smart investor knows that if you’re responding to a market crash, you’ve waited too long. Your strategy should be forward-thinking and risk management should play a major role. But when every stock on the market is in decline, where can you put your money without losing value?
When S&P Dow Jones Indices are in decline, gold prices rise. Gold is often thought of as a “defensive” investment strategy, protecting wealth against negative returns. Entering a bear market prepared means hedging against initial losses while you respond, and that means buying gold before the decline begins. You can diversify your portfolio with gold bullion easily by buying gold coins, wafers, and bars from online gold dealers. One such online gold dealer, Silver Gold Bull, even connects high net worth investors with a senior executive who can help you realize your financial goals with gold investment. With one of the largest inventories in Canada and deep liquidity, you never have to wait for gold bullion orders to be fulfilled, and you benefit from easy 2-way trading. For more information on trading gold as an individual investor, visit a gold dealer to learn about:
- Buying gold with Bitcoin
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- Free, insured gold delivery when you buy online
- Allocated storage solutions at Silver Gold Bull
In the last year, the negative relationship between the Dow Jones and gold reached minus 0.63, the most negative it has been since 1984, according to Market Watch. What does the negative relationship between the Dow Jones and gold mean, and how can you benefit as an investor? The negative relationship is a measure of how much gold goes up or down inverse to the Dow’s success or decline. A perfect negative 1.0 would mean that every downward tick in the Dow would see an equal tick upward for gold. A positive 1.0 would mean that they increase and decrease in tandem, and zero would mean they have no relationship to each other.
This negative relationship may have reached historic highs, but it’s a relationship that the markets have seen to one extent or another for decades. When conditions get tough on the stock market, investors flock to gold. Seen by investors as a safe haven for capital when it’s difficult or nearly impossible to earn interest on investments, gold becomes appealing when you’re more likely to lose money on stock markets. If you want to know the answer to the question, is buying gold a good investment, look no further than investor behavior during a market downturn.
Prepare for pullbacks and bear markets by buying gold before you lose out on your hard-earned savings and investments. When the markets show weakness, investors flock to gold, driving the price up in negative relationship to stocks. Shore up your defensive investment strategy with gold today.