The best time to buy an asset is when it is on sale. Given the recent 2% decline in the price of gold, current levels could fall into that category. Short-term dips in the price of gold should not be feared, but should be welcomed. This is a great opportunity buy gold at a lower price point.
There are those that will argue that an asset should not be bought on weakness, but should rather be purchased when it is showing strength. This is a common theme seen with stock investors. So-called experts will suggest things like “buy when it breaks out to new highs,” “buy the upside breakout from a congestion pattern,” or “only buy in an uptrend.”
If you were in the market for a new car, would you want to wait for prices to go higher before buying?
If you were in the market for a rental property, would you want to wait for the value to go up before buying?
Of course not.
You would prefer to buy a car below sticker and get a good deal.
You would prefer to buy a rental property well below market value. As they say, money is made in the purchase price not the selling price.
Then why is it that experts suggest buying assets when they are more expensive? From a standpoint of value, this literally makes no sense. Leave the ‘strength buying” to the short-term traders. If long-term value is what you are looking for, you should be buying on any dips with both hands.
It is the buying on dips in the gold market that will allow you to lower your overall cost basis. In the world of equity investing, they refer to it is dollar-cost averaging. A stock investor that wants to build a big position in a stock may buy that stock on any dips or even at regular intervals. Doing so may potentially lower the overall per-share cost basis over time.
Investing in gold should be no different. The idea should be to buy as much physical gold as you possibly can at the best price levels possible. It is for that reason that any sharp declines in gold should not be feared, but should be welcomed.
The recent dollar strength that has fueled some of the selling in gold is not going to last. All of the major fundamental factors that could propel gold sharply higher from current levels remain in place. The declines in recent days represent an opportunity to buy gold “on sale.”
If value, rather than short-term gains are what you are interested in, then the recent decline is a screaming “buy.” The successful long-term investor is able to see the bigger picture and is not concerned with short-term market fluctuations. To them, this price action is nothing more than noise.
All you have to do is take action.
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 build an allocation in this key asset class using your IRA account.
Don’t wait for prices to start moving higher again before taking action. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: advantage gold, cost basis, dips, gold, trading, trend