Gold as an investment?

salsaconnoisseur

hello there, 

New to MSE so if this question has been already asked and answered, apologies. So gold has increased 5 times in values since 2000s.

FTSE100 has gone mostly sideways. Why should I not invest more in gold every month?

p00hsticks

Welcome to the forum.
There is a Savings and Investments board on the forum where this question is probably better asked (and may well have been discussed before). I'll put in a request for the Forum team to move it over there 

ColdIron

salsaconnoisseur said:

FTSE100 has gone mostly sideways.

You have not included dividends and the FTSE100 is not the gold standard of indexes (pun intended)

Why should I not invest more in gold every month?

One reason might be that it is presently at an all time high

Gold is a speculative asset (and it doesn't pay dividends) rather than a true investment, but it could (and probably will) go either way over time

eskbanker

salsaconnoisseur said:

hello there, 

New to MSE so if this question has been already asked and answered, apologies. So gold has increased 5 times in values since 2000s.

FTSE100 has gone mostly sideways. Why should I not invest more in gold every month?

It's easy to pick winners with hindsight!

Nebulous2

There may be a case for people having a small amount in a well-diversified portfolio, but it wouldn't be suitable as a large part of your holdings in my view. 

Issues are; volatility, lack of income from it, issues with storage for physical gold, scams for non-physical gold, VAT etc. 

I have a krugerrand which was a present in the 70s.  There have been periods, possibly as much as years, when I don't look at it, and even times when I have not been 100% sure of its physical location, but it always turns up again.

£70 or so then is worth about £1700 now, so it hasn't done too badly. 

Albermarle

salsaconnoisseur said:

hello there, 

New to MSE so if this question has been already asked and answered, apologies. So gold has increased 5 times in values since 2000s.

FTSE100 has gone mostly sideways. Why should I not invest more in gold every month?

The FTSE 100 represents a relatively small part of the global financial markets, which are dominated by the US.
The S&P 500 has typically returned 10% pa on average.

Issues are; volatility, lack of income from it, issues with storage for physical gold, scams for non-physical gold, VAT etc. 

A physically replicated Gold ETF, with Blackrock for example, is a safe way to invest in.
One problem with Gold is that it is directly affected by the strength or weakness of the Dollar.

boingy

I've always thought it would be fun to own one of these:

https://www.royalmint.com/invest/bullion/bullion-bars/gold-bars/royal-mint-1kg-gold-bar-cast/

but not as an investment.

@salsaconnoisseur , it's true that gold has seen good growth over the last 20 years or so. However, for the 20 years before that it pretty much flat-lined. The big question is: what will it do in the next 20 years?

masonic

salsaconnoisseur said:

hello there, 

New to MSE so if this question has been already asked and answered, apologies. So gold has increased 5 times in values since 2000s.

FTSE100 has gone mostly sideways. Why should I not invest more in gold every month?

A few charts. First shows FTSE 100 and FTSE World indexes. Neither have moved sideways, but clearly the global one has been better over the past decade or so. Next two show US stocks (blue) vs gold (red) over 30 and 100 years, no explanation necessary. Finally a chart showing Bitcoin over about 10 years (that's a 64000% increase) - no the conclusion isn't Bitcoin did better therefore Bitcoin will continue to do better!

JohnWinder

Because past performances are not preludes to future performances. 

Bigwheels1111

My friend has 40k tied up In Britannia coins.
Purchased three times in last 6 months.
Until a few weeks ago he was 7k down on value. Now 2k down.
I advised against them as rates are not good, plus buying and selling commission is high.
I know nothing about the market I must admit.
Ive just watched the price over the last 2 years and did not see enough movement after fee to make a good return.

Sg28

I bought 25 gold sovereigns early 2020 Ive always like coins and collected coins so they have a lot of appeal to me. I do enjoy owning them. This helped offset the fact that it may not be the best investment. 

I would say the price I could sell at currently is about 12% up on the price I paid. Not the best but certainly not the worst investment over the period.