While it may be difficult for clients to remain calm during major market declines, it is imperative for them to remember that volatility is an expected ingredient of investing. If you or your clients are “searching for the exits” on current overall positions during volatility you may need to add an equalizer to their portfolios. Gold and silver historically play an inverse role to the stock market, making them an important piece of any portfolio. We here at National Gold Consultants refer to physical gold and silver as “wealth insurance.”
It is critical to incorporate a portion of your client’s portfolio into physical gold and silver to help mitigate risk. Risks imposed by the U.S. dollar, the stock market or even the housing market can affect your clients’ retirements overnight. However, when your clients are diversified into physical gold and silver, they can navigate volatile times easily knowing that they have a counterbalance in place to help equalize or even profit in turbulent times. Additionally, for the long-term investor, this diversification removes the need to react to volatility by changing positions, which may be more detrimental to portfolio performance than the volatility itself.
Uncertain times surround us – not only in the financial realm but in the political and global as well. Financially, the stock market is boasting 500-point swings far too regularly for my comfort level while gold and silver have rebounded off of last year’s lows and are doing a great job of showing stability in an unstable market.
Politically, the U.S. government shut down is kicking off a new week and is now the longest in U.S. history. Likely to add to its length is the Democrats’ newly-gained control of the House, which has President Trump considering the use of an executive order over southern border security so that normal government function can resume.
Globally, China’s economy also began to draw down as the year ended. Many economists agree that this is due in large part to its trade war with the U.S. It appears that negotiations are finally moving forward, though, as President Trump and President Xi Jinping agreed to ceasefire, giving themselves until March to reach some middle ground. How this may affect gold and silver, if at all, remains to be determined.
Do not wait to furnish your clients with wealth insurance in the form of physical gold and silver. If you would like to know more about offering physical gold and silver as part of your client offerings, please do not hesitate to call or email. We can also send you our new advisor welcome packet to help jumpstart your understanding of wealth insurance.