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Equities – shares that represent an ownership interest in a company – are often seen as the default investment. However, global uncertainty is making investing in equities and the stock market less attractive than it once was, especially when safer investments are available.
Equities enable anyone to profit from successful businesses, effectively making their successes your own. They offer interesting diversity, from the chance to own your own slice of the action in the media industry, through to owning shares in your favourite brands of food and drink. The entire world is open to trading and investing shares, and for a new investor it can make for a fascinating learning curve.
Investing in a company in which you have faith, whether well-reasoned or not, can definitely be pleasurable. However, a company that seems to be on its uppers one day could take a tumble the next, and all it takes is some negative media attention to suddenly erode a given organisation’s equity value.
Recoveries can take a long time, or fail to manifest, so equities should be seen as more of a gamble – which for some investors is part of the attraction. Be wary of companies falling into insolvency, however, as this can result in the complete collapse of an equity’s value.
Another attractive property of investing in equities is they provide regular income in the form of dividends. Dividends allow investors to share in a company’s profits, and while gold is extremely easy to liquidate it does not provide direct income in this way.
Gold is a finite, physical asset with a proven track record for stable growth. This has allowed it to become a “safe haven” investment, the value of which tends to increase when confidence in the financial market is low.
Gold offers a way to protect and grow your wealth without unpredictable swings. This means that is useful to the investor primarily for long-term investment and the protection of excess capital against an unstable financial market.
Without the counterparty risk involves in equities and other traditional forms of investment, gold is a valued as a way to store wealth outside of banks and the stock exchange, preventing loss of capital as a result of an economic downturn.
Gold’s supply is limited and is dwindling, leading many to speculate large gains will occur in the coming years.
Investing in gold is also a simple process, with easy liquidation, and storage options to suit any investor’s circumstances. Investing in gold also need not require a large amount of capital – in fact it’s possible to invest in gold for as little as £200 a month through The Pure Gold Company’s Gold Saver scheme.
As well as this, gold offers the particularly attractive option of being potentially tax-free. Investing in UK gold coins which are legal tender means that you are free from capital gains tax, which is a factor in the choice of many investors who turn to gold.
In the last decade, gold has significantly outperformed the values demonstrated by the top performing companies on the London Stock Exchange.
When looking to grow the wealth gained from hard work, investing in something with large counterparty risk is usually a failing strategy. Investing in physical gold allows you to protect that wealth, alongside the likelihood of your purchase increasing significantly in value.
In addition, the value of equities is based on outlook, which can become uncertain through a variety of factors including monetary and fiscal economics and political shifts. It’s often difficult to attribute a reasonable share price to an equity and as such the potential for prices to fall considerably is compounded, raising the risk of an investment’s value vanishing.
In addition, the equity market is at an all time high, with the risks that entails. With prices as high as they are, the chance of a collapse increases with every further rise. Gold, on the other hand, is still 25% less than its peak in 2012 and well below its historic peak in the 1970s, making it undervalued.
Gold investment with The Pure Gold is handled by experts who will take you through the best options given your requirements. For a tax-efficient and stable way to grow and protect your wealth, there is no better choice than investment in gold.