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5 gold investments to consider with inflation rising
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Inflation is no longer hovering near 40-year highs like it was in mid-2022, but we’re not back to normal just yet. The latest inflation report, released this week, shows that the inflation rate was 3.2% in February, up from 3.1% in January. Given the negative impact that stubborn inflation has on traditional currency, many investors are now looking for ways to protect their investments from being eroded by rising prices. And, one traditional hedge against inflation is gold.
When inflation rises, the purchasing power of paper currencies inevitably declines. That makes gold, which carries no counterparty risk and cannot be inflated by central banks, an attractive investment for investors who want to preserve their wealth. If you’re looking to add some gold exposure to your portfolio as an inflation hedge, though, it’s important to understand that there are numerous assets to choose from.
Learn more about how gold investing can protect your portfolio here.
5 gold investments to consider with inflation rising
It may be worth adding these gold assets to your investment portfolio now that inflation is rising:
Physical gold bullion
One of the most direct ways to invest in gold is by purchasing physical bullion in the form of gold coins or bars. Owning the actual metal provides a tangible store of value, one that is not tied to any particular currency or economy.
The downside is you’ll need to securely store and insure your gold holdings, which can come with extra work and extra costs. But if you’re seeking a “crisis commodity” to fall back on, physical bullion is about as close as you can get to having intrinsic, universally recognized wealth.
Explore your top gold IRA options online here.
Gold exchange-traded funds
For a more liquid and convenient way to invest in gold, you can purchase shares of an exchange-traded fund (ETF) that tracks the price of gold bullion. When you buy into a gold ETF, each share represents ownership in actual physical gold bars held by the fund.
Gold ETFs can be a smart option to consider because they provide exposure to gold prices without the hassle of personally acquiring and storing bullion. They can easily be bought and sold just like stocks through any brokerage account. However, there are small annual expenses charged by the funds, which you may want to consider before taking this route.
Gold mining stocks
Rather than invest directly in gold itself, you can gain leveraged upside exposure by buying shares of gold mining companies. When gold prices rise, the profits and stock valuations of the miners tend to surge even higher. You also have the option of investing in gold mining ETFs to gain broad exposure.
The allure of buying gold stocks is the potential for higher returns, which is great in any economic environment, but can be especially useful during times when inflation is devaluing the dollar. However, these stocks also come with higher risk than just owning physical gold or a bullion ETF, so keep that in mind as you narrow down the options.
Gold jewelry and collectibles
Beyond strictly investment purposes, gold jewelry and collectible gold coins can appreciate in value as inflation rises. While these purchases don’t provide direct exposure to gold prices, the precious metal content gives them an intrinsic material value that helps preserve wealth over time.
And, with inflation weighing on other assets, collectors tend to bid up the valuations for rare, historical gold coins in particular. These types of gold investments can grow in numismatic value alongside the underlying metal prices, providing a unique potential return stream.
Gold futures and options
For advanced traders and hedgers, gold futures contracts provide a way to speculate on future price movements or lock in current prices. However, due to the complexity, leverage and risk of losses that are associated with gold futures and options (beyond the initial investment), this gold investing option tends to be most suitable for highly experienced, risk-tolerant traders looking to make leveraged bets on gold prices.
The bottom line
As always with any type of investing, it’s important to understand your time horizon, risk tolerance and objectives before allocating capital to gold. After all, there is a wide range of gold investments to choose from, and those factors will play a role in determining which one works best for you, especially during periods of high inflation. But no matter what gold asset you decide on, when used judiciously, gold can be an important part of a diversified portfolio, providing a hedge against the insidious effects of inflation.
On a trip to New York City earlier this month to appear on “Saturday Night Live” for the first time since 1983, Stevie Nicks said she was scared to death. She said her first reaction when she got the call to appear on “SNL” was, “Absolutely not. Because I was terrified to do it, ’cause it goes out live!”
But she did appear on “SNL,” and her performance of “The Lighthouse” brought down the house.
She says the inspiration for her latest song, a rallying cry for women’s rights, struck a few months after Roe v. Wade was overturned, and it took her less than a day to write the song and record it.
Smith asked, “It takes some courage to step into the waters of the abortion debate. Why take the risk?”
“Because everybody kept saying, ‘Well, somebody has to do something. Somebody has to say something,'” replied Nicks. “And I’m like, ‘Well, I have a platform. I tell a good story. So maybe I should try to do something.’ I was also there. I was, been there, done that.“
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In the late ’70s, Nicks was on top of the world with the legendary band Fleetwood Mac. She’d broken up with her longtime partner and Fleetwood Mac bandmate Lindsey Buckingham, and she was romantically involved with Don Henley of The Eagles when she found out she was pregnant, and decided that, as a touring musician, being a mother was not in the cards.
In 1979 she terminated the pregnancy. “In my younger life, I’d already decided I didn’t want to have somebody have their feelings hurt all the time, and like, ‘When are you comin’ back?’ ‘Well, I don’t know. I’ll be back when I get back,’ you know?” Nicks said. “And not even having any idea how big that Fleetwood Mac was going to get in the future, you know? And this is, like, super personal and weird, so you know … you can edit this out if necessary.”
“I appreciate your sharing this story though,” said Smith.
“Well, and it’s a good story, too. I tell a good story!” Nicks said. “I got pregnant. And it was like, Why? I have an IUD. I am totally protected. I have a great gynecologist. How come this has happened? What the heck?“
“So you took all the precautions?”
“Yes. And I’m like, This can’t be happening. Fleetwood Mac is three years in. And it’s big. And we’re going into our third album. It was like, Oh no, no, no, no, no, no.“
Nicks said it would have “destroyed” Fleetwood Mac if she had had the baby: “Absolutely, because many reasons. I would’ve, like, tried my best to get through, you know, being in the studio every single day expecting a child. But mostly, having a child with Don Henley would not have gone over big in Fleetwood Mac, with Lindsey and me – we had been broken up for two or three years. It would’ve been a nightmare scenario for me to live through.”
Fleetwood Mac was a collection of stars, but Stevie Nicks was front-and-center. She was the one who wrote the band’s only #1 single in the U.S., “Dreams,” a song that is still a hit today on streaming.
But if “Dreams” is about heartache and vulnerability, Nicks’ new song is just the opposite: it’s about fighting for the same reproductive rights that she had.
Smith asked, “There are people who criticize your choice, condemn your choice. Anything you want to say to them?”
“I’d like to know, so are you just the few guys who are making the decisions for us?” Nicks replied.
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She said the choice, ultimately, “was mine. And you know what? If people want to be mad at me, be mad at me. I don’t care. Had I made the other choice, had I gone the other way, I’d have been a great mom. I went this way, and I’ve done great.”
Nicks would go on to new heights as a solo artist, becoming the first woman to be inducted into the Rock & Roll Hall of Fame, twice.
Of course Nicks has had her share of heartache as well. The woman she called her musical soulmate, Christine McVie, died in 2022, and Nicks was shattered.
“I wanted to go and step in, sit on her bed, and hold her hand, and sing ‘Touched By An Angel’ to her until I was sure she heard it,” she said. “And I didn’t get to. And I didn’t get to say goodbye to her.”
Nicks now ends her shows with a moving tribute to her best friend. She sings, but can’t bring herself to watch. “We have a really beautiful montage of her and me. I never turn around and look. I can’t, ’cause I’ll start to sob. And if I start to sob, then I won’t be able to finish the song. So, I just don’t look at it.”
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Nicks says that, although McVie is gone, she feels her presence with her all the time. She wears a necklace containing some of McVie’s ashes. “A little bit of her,” Nicks said. “But as important as that is, she’s in my heart,” she said.
Nicks says she really doesn’t care whether her new song, “The Lighthouse,” is a hit or not; she just wants people to listen. “Poets write what they write, and poets should not be censored. Writers should not be censored. This song should not be censored. It should go out into the world and do what it’s gonna do, maybe change some minds. There is a God, and God gave me this talent to sing and write and dance. So, I’m doing my job.”
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Story produced by John D’Amelio. Editor: Steven Tyler.
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