What are the advantages of investing in a precious metal mutual fund?

Investing in precious metals has always formed an attractive proposition for old and new investors alike. In today’s climate, those charms are arguably brighter than ever.

It’s always worth having gold or other assets in your portfolio. There are a number of reasons that contribute to their value. Using precious metal mutual funds should be a keen area for your future investment plans.

Here are just some of the compelling reasons to dip your toes in this arena.

Global Appeal

No matter how much research you put in, it’s impossible to predict the future of a nation’s economic climate.  It’s always advisable to have a percentage of your investment capital tied up in a commodity that carries a worldwide attraction. Precious metals like gold certainly provide this in abundance.

The fact is that precious metals are a global currency. At times of financial uncertainty, having this type of asset in your investment portfolio is very beneficial indeed. There will always be a market for those assets, giving you extra security if other ventures go pear-shaped.

An Investor’s Safety Net

Precious metals carry an almost unique trend in the sense that they tend to work in a manner that contrasts with general stocks and shares. Whereas most investments respond best to an economic boom, gold tends to see the best results when things aren’t going so well.

That’s not to say those investments can’t succeed in a thriving market. But those trading properties offer a huge degree of comfort when values are plummeting across other areas of the board. Even a small investment could save you in otherwise difficult periods. For that reason alone, every investor should be eager to add precious metals to their portfolios.


Another wonderful thing about trading in this arena is that individuals can tailor those ventures to suit their needs. Amongst others, the various options include coins, bullion and stocks. As with any form of investment, risks are involved. Nevertheless, using several routes at once can be a great way to minimise the potential damage.

Similarly, the versatility over increments makes it a suitable for investors big and small. This leads to greater control which, when handled correctly, can only bring positive results.

Invincibility To Inflation

Generally speaking, inflation is a killer for stocks and shares. Times of soaring prices can decimate other investment opportunities. Conversely, precious metals tend to retain value during these periods.

This is largely because they are a direct opponent to currency rather than the value of money. No matter what happens in terms of inflation, gold and other metals offer a safe investment solution. It’s yet another advantage, particularly for long-term investors. And it can have a telling influence on an overall portfolio too.

A Buyer’s Market

As already mentioned, precious metals tend to contrast other markets. The recent resurrections following the global economic recession have led to gold taking a slight hit in recent years. The decline hasn’t been massive, but it can’t continue indefinitely. This makes it the perfect time to get involved by adding an investment to your assets.

The tactic of buying low and selling high is one of the oldest in the book. But it still has a huge role to play in the fierce arena of investments. Timing is everything. While it’s impossible to predict a guaranteed increase, it seems likely that the markets will improve sometime soon.

High Demand

There’s nothing worse than not being able to sell an asset. There are various potential situations where you may desire a quick sale. Having precious metals in your trading portfolio can offer the perfect solution for fast access to capital.

Aside from being recognised worldwide, the demand for gold means that you’ll never have a problem finding a buyer. Of course, you don’t want to rush yourself into a poor deal. Nonetheless, knowing that you have an sellable asset in your portfolio offers another safety net. That’s something that every investor should appreciate.

Guaranteed Longevity

The worst nightmare for any investor is to see a venture go up in smoke. Backing companies, for example, can be very volatile. A bankruptcy could literally leave you losing everything. That’s never going to be an issue with precious metals, which is another reason to look at precious metal mutual funds.

Ultimately, you can’t take out the risks of investment entirely. The best thing you can do is minimise them. Going for gold might not be the only asset you’ll turn to, but accommodating it into your portfolio is often a very useful method indeed.

Elizabeth Goldman is the editor of AlternativeInvestmentCoach.com. She has written for Investing.com, Bullbearings.com and many others.