The last couple of weeks have seen rising stock market volatility as numerous issues weigh on markets and investor sentiment. The declines seen in Chinese markets cannot, and should not, be ignored. The Shanghai Composite is off some 25 percent since the beginning of the year, and more downside could potentially be in store.
The Chinese economy has already shown some key signs of slowing, and if it does in fact slow further the effects may be felt all over the globe. Chinese officials have already taken some action through tax cuts, and may be discussing other forms of stimulus measures to prop up the economy. Nevertheless, Chinese markets have seen some significant price volatility and that volatility has now spilled over into U.S. and other markets.
U.S. stocks may have already put in a final long-term top and market volatility, as measured by the CBOE’s VIX index, has been climbing. Key moving averages have been violated and the tech-heavy NASDAQ is now flirting with correction territory for the first time in two years.
It is becoming increasingly difficult, if not impossible, to come up with legitimate reasons that stocks may forge another round of fresh all-time highs. Interest rates are on the rise, the U.S./China trade war is in full swing, there are midterm elections around the corner and companies may simply be unable to deliver earnings as anticipated going forward.
And don’t forget about the dollar. The greenback has enjoyed some nice tailwinds in recent months, but the currency is likely to roll right back over as rates do not rise substantially and as deficits become increasingly unmanageable.
The bottom line? There are plenty of warning signals flashing a bright red right now and this may be the time to take action before the selling gets even uglier.
The coming months, quarters and years could see a bear market in stocks take hold, a deep recession, and decline in the dollar among other things. That being said, there is an asset class available that could not only see strong upside price appreciation, but could also provide an important hedge against a weaker dollar, rising inflation and other economic and geopolitical risks.
That asset class is hard, physical gold.
Adding this key asset class to your portfolio has never been easier, and arguably has never been more important than it is today.
Speak with an Advantage Gold account executive today about the potential benefits of gold ownership and why now, more than ever, is the time to build a significant allocation in this key asset class. Our account executives are here to answer any questions you may have, and can even show you how easy it is to build a large allocation using your IRA account.
Don’t ignore the numerous warnings markets are showing right now, and don’t wait for gold prices to move sharply higher from current levels. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: advantage gold, chinese markets, gold, midterm elections, vix index, volatility