Although stocks are down in early action Monday to kick off the new trading week, the market has shown great resiliency in recent months. In fact, there has been little to put a stop to the market’s upward trajectory, and investors appear to be quite comfortable buying stocks even at current levels.
Tech stocks are flying high while more defensive equities such as telecommunications, healthcare and pharmaceuticals are seemingly being left behind. Some analysts have suggested that this points to a massive bubble in assets, while others believe the market could still have room to run higher. And why not? Capital is still flowing into high-flying, possibly overvalued tech stocks at a fast pace. Investors seem to be selling recent losers and turning around to buy recent winners. This can lead to overvalued stocks moving even higher, and even further into “bubble” territory.
The stock market at current levels seems a lot like the tech bubble of the early 2000s. Investors seem to be irrationally exuberant, and the air is thick with an overall sense of complacency. That is often when the bottom falls out.
Although stocks could have more in the tank, the question should be how much more, and for how much longer. Bull markets do not last forever, and at some point, the bears will come out en masse, ready to pounce. The higher stocks continue to drift from current levels, the more significant the eventual decline may be. The time to prepare for that eventual decline is not after stocks have fallen by 20, 30, even 50% or more. The time to diversify away from equities may be right now.
And what better asset to diversify with than physical gold?
Gold has been considered a reliable store of wealth and protector of value for centuries. This asset class can play a vital role within a portfolio. Not only does gold have unlimited upside potential as a natural resource of finite supply, but it may also potentially provide a significant hedge against many of today’s economic and geopolitical issues such as rising inflation and a possible trade war.
The metal is currently not far from its lowest settlement of 2018, so what better time to buy? Although gold has remained relatively range bound for some time now, it appears to be simply biding its time until the next major economic or geopolitical crisis. When the next recession or major global stock market sell-off comes, whether it be next week, next month, or next year, assets such as gold could see dramatic capital inflows as investors hurry to get out of stocks and put funds to work elsewhere.
The question, therefore, is whether you would rather buy gold around current price levels or would prefer to pay more. Assuming you would prefer to “buy low and sell high,” now may be the time to act.
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 a significant allocation in this key asset class using your IRA account.
Don’t wait for the current stock market bubble to burst 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, bubble, gold, stock market decline, store of wealth, trading, volatility