Precious metals like Gold and Silver have historically been go to investments for centuries. Nowadays, Bullion is the primary form we can find precious metals in for investment purposes. Many still invest in bullion to this day to diversify their portfolio. Like any investment, precious metals have their own set of risks associated with them that you should be aware of.

Risks Associated with Bullion: 

Market Volatility

When looking at things from a long term perspective, precious metals are seen and considered a stable investment. However, in the short term, prices can be very volatile as they can shift due to wars, changing economic conditions, as well as supply and demand factors. 

Storage 

Storing physical bullion is another risk factor that must be taken into consideration to avoid damages and theft. With a large enough portfolio, it sometimes may get difficult to safely store your bullion. Which is why investors need to consider safety deposit boxes, safes, as well as storage services. 

No Passive Income 

Precious metals will not be investments that pay you back like dividend yielding stocks. These are investments that you will be investing and using as a form of storage for your wealth. 

Mitigating these Risks: 

Understanding the Market 

By having a better understanding of ther market and its trends, you will be able to better prepare yourself when there is high volatility in the market. Knowledge of the indicators that affect prices is imperative. 

Diversification 

We have all heard of the saying “Don’t put all your eggs in one basket”. This is a true saying and is important to note. Like any investment, precious metals should not be the only investment in your portfolio. It is important to diversify and have multiple different investments to choose from. 

Long Term Perspective 

Looking at precious metals is the way to go. This is not an investment that will make you “get rich quick”. This is an investment that will store your wealth and help fight against inflation. Historically, Gold has always performed well during times of economic crisis and has gone up in prices significantly over the years. Precious metals is a great way to invest your wealth for the long term!