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How is gold a form of "insurance"... and can gold be a good hedge?

Eric Janszen

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Prepare and DiversifyFree Prepare & Diversify with Gold & Silver Report
Many investors are faced with the challenge of having to prepare their portfolios during a time of economic uncertainty. To help investors prepare, Monex is now offering our customers and prospective customers open access to the latest available analyses, forecasts and recommendations on investment diversification with precious metals from the widely-recognized financial market analyst, author, and Managing Partner of CPM group, Jeffrey Christian. When you discover what is presented in these reports, you'll see why we here at Monex believe it is urgent to consider diversification with precious metals. For your free reports please speak to a Monex Account Representative now by calling 1-800-444-8317.

IMPORTANT NOTE: The information presented in these video clips is solely a highlight of the opinion of a third-party and is incomplete. Please visit the website and/or subscribe to the publication for the full and timely opinion of the individual and call a Monex Account Representative for any additional up-to-date information. This is not an offer to buy or sell precious metals. Investors should obtain advice based on their own individual circumstances and understand the risk before making any investment decision.

Video Transcript

My view of gold is as a hedge, it's insurance, and there are a number of risks in the financial in the world economy right now, which can only effectively be hedged by buying gold. Which is not to say take all your money and put it in there, my allocation is 15%. Now since I bought it back when gold was at $250, now my allocation is now 30%, but that's ok I should probably widen my allocation, but generally I recommend somewhere between 10% and 15%, which by the way was what everyone used to recommend up until maybe 10 or 15 years ago that used to be a pretty standard financial advisor's advice to anyone, back before everyone thought that inflation had died. That's the general view today is that there is no inflation, we'll never see inflation again, all the problems of monetary management have been solved, and there's no possibility of any kind of event occurring that would cause the dollar to decline significantly and a lot of inflation. So the truth of the matter is that there's a lot of times most times are not good times to buy gold, but we at one of the times when it is because, again, there's a lot of risk in the financial markets, a lot of risk in the currency markets that are unique to our period.