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Buy Gold As Strategic Hedge - World Gold Council

Kitco News

(Kitco News) - Gold should be seen as a strategic asset that investors use to weather the storm, says Juan Carlos Artigas, Director of Investment Research at the World Gold Council.

Artigas told Kitco News that gold, as an insurance, should be consistently held in a portfolio and not bought only when there is an equities market correction. “If you look at history, you’ve seen these [equities] corrections happen.

If you wait until the last minute to protect your portfolio from that correction, you may actually miss it,” he said.

“The reason that gold is seen by investors as a strategic component is that it belongs in a portfolio throughout.”

Speaking on cryptocurrencies, Artigas said that Bitcoins are not solely responsible for gold’s depressed returns of late, as some analysts have suggested. “The reality is that whatever flows may go into the cryptocurrency space are coming from many places; from the stock market, from bonds as well. I don’t think it’s fair to say it’s coming from one place or asset,” he said.

According to the researcher at the World Gold Council, Bitcoins should not be seen as hurting gold, as the two assets have fundamentally different purposes. “Their roles are very different,” Artigas said. “Investors look to gold for three reasons: for consistent returns, as it has…about 2%, on average, every year since 1971, for effective diversification, and for a very liquid market. The combination of those bring better risk-adjusted returns over time.”

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