Either way, both assets are used in a similar way: to make profits and protect the economy. That said, many so-called “experts” recommend investing in stocks, with an investment of 30 to 40% in precious metals. In general, it is said that between 10 and 20% of that should be in gold and silver each, although that depends on you. Precious metals don't pay dividends: Owning physical gold and silver or other precious metals doesn't give you an opportunity to earn dividend income.
This is a very common discussion regarding these investments, as dividend-paying equity investments can give investors the opportunity to accelerate portfolio growth. The research showed that the “sweet spot for the percentage of gold in the portfolio is 20%. In the long term, this provides the best balance between risk and reward. In times of relative stability and prosperity, 10% is the general rule.
However, as the economic climate becomes more volatile and geopolitical risks increase, you should increase your allocation to gold as much as necessary to effectively protect your wealth. Investors treat gold more like a currency than silver, a metal that has far more industrial uses than gold. While vaults like this exist, gold bars are much more accessible than the gold owner can imagine. Some of the most popular precious metal ETFs include SPDR Gold Trust (GLD), iShares Gold Trust (IAU) and iShares Silver Trust (SLV).
While silver and gold have similar boom-and-fall cycles, there are a few key differences you should consider when choosing between buying gold or While short-term fluctuations in the price of gold generally receive a lot of attention, gold is relatively stable as a long-term investment compared to silver. Sure, there are times when gains in gold will outpace those of silver, but for the most part, the low-volatility and slow-moving nature of gold prices results in lower returns. This chapter will explore important considerations for any gold buyer or investor to help you determine how much gold and silver you should buy.