Balancing Portfolios – Buying and Selling Gold and Silver

Investing in a balanced portfolio is a foundational element to long-term financial security and prosperity. Each investor’s ideal investment mix may look slightly different, but the general idea is to spread your money across major asset classes — stocks, bonds, real estate and cash equivalents — while keeping your risk tolerance and investment timeline in mind.

This is known as your target asset allocation, and it’s generally recommended that you revisit and rebalance this portfolio at least once a year. This is because asset classes are expected to perform differently over time, and rebalancing helps you stay on track with your intended percentages.

If you’re saving for retirement that’s decades away, for example, it might make more sense to take a hands-off approach and only check in occasionally. As you get closer to that retirement date, however, it’s important to rebalance your portfolio more frequently to ensure that the amount you need to spend is covered with a sufficiently large margin of safety.

There are a number of benefits to rebalancing your portfolio regularly, but it is not guaranteed to increase your returns. It can, however, help to mitigate risks by reducing your exposure to specific asset classes, regions or industry sectors. Additionally, rebalancing can help you recognize opportunities to buy low and sell high.

While it’s impossible to predict the future, rebalancing can help you identify underperforming assets that need to be sold off and replaced with high-performing assets. This can boost your overall returns over the long-term.

The process of rebalancing your portfolio can be complicated, and it’s worth considering the pros and cons of each action before you decide to do so. For instance, you might want to consider the potential tax liability of any sales and the investment options for the proceeds from those sales. You might also want to think about whether it’s appropriate to rebalance your portfolio during periods of market volatility, and you should certainly think about how rebalancing might impact your goals in the future.

In terms of gold and silver, it’s always a good idea to have some form of physical precious metal in your emergency kit. Unlike paper currency, physical metal has the advantage of lasting value despite rising prices or deflationary conditions. It’s also easy to store and access if you need it in the event of a disaster, like an earthquake or power outage.

In addition to owning physical precious metal, you can also invest in gold and silver exchange-traded funds (ETFs) that track the price of the metal. These funds can be traded throughout the trading day like normal equities and offer you an indirect way to gain exposure to the gold and silver markets without paying for storage fees or taking on the risks associated with owning physical metal. Alternatively, you can even purchase shares of individual gold and silver mining companies for direct exposure to the metal’s value. However, these investments are more risky and often don’t produce the same types of returns as gold and silver ETFs do. If you are interested in investing in Gold make sure you get a help from a reputable Alexandria precious metal buying and selling company in your area.