The roller-coaster continues. After seeing significant selling to start the week off, stocks rebounding on Tuesday. The Dow Jones Industrial Average finished higher by nearly 400 points on the day, and investors appeared to be putting worries over a trade war behind them-at least for the day.
As has been discussed in previous posts, however, there is likely something much larger brewing in the equities markets. Recent volatility, along with a significant spike in the markets fear gauge, the “VIX,” could point to a topping process already well under way. Savvy investors may take notice, while the market “chasers” will likely keep buying until the market has officially topped and turned south.
Soon, likely sooner than many realize, the stampede out of stocks will begin and there will be a rush into alternative asset classes. Here are three simple, valid reasons to consider exiting a large portion of stock holdings right now, and putting a significant amount of capital to work in gold:
- The bull market is going to end-probably soon: The bull market in stocks has been going for a decade now, surpassing even some of the most bullish expectations. At some point, the market will reverse course. Investors not paying attention may give back a considerable portion, if not all, of the wealth they have accrued over the last several years.
- Inflation is accelerating: The price of everyday goods and services is rising. Government economic reports aside, has it gotten any cheaper to buy a tank of gas or go on a weekly grocery run? Inflation is accelerating, and if left unchecked could expand well-beyond the Fed’s desired target of 2% annually. Higher inflation means a decline in purchasing power as well as net returns.
- Stocks may be at or near the end of the bull market-gold on the other hand may be just getting started: See point #1. Investors have been fully invested in stocks for some time now, and when the levee breaks look out below. Much of the capital flowing out of stocks will have to go somewhere. Interest rates may not yet justify a significant investment in money market funds or bonds. Hard assets like gold, however, may potentially provide not only significant price appreciation potential but may also offer a meaningful hedge against rising inflation, a weaker dollar and the current geopolitical landscape.
The only question is whether you would rather buy low and sell higher or simply buy high.
Assuming you would prefer the former and not the latter, right now may be the ideal time to put a plan into action. The current environment is highly conducive to higher gold prices, and it is likely only a matter of time before prices take off to the upside.
An investment in gold may allow you-as a matter of speaking-have your cake and eat it too.
But don’t wait. Prices have already been rising and a significant upside move could be seen any day now. Making a significant allocation in physical gold has never been easier than it is today. All you have to do is pick up the phone.
Speak with an Advantage Gold account executive today about the potential benefits of gold ownership. Our associates are here to answer any questions you may have, and can even show you how to buy this important asset class using your IRA account. Call Advantage Gold today at 1-800-341-8584 to get started.Tags: advantage gold, bull market, cycle, dow, gold, inflation, vix, volatility