Investing in Gold and Silver: A Decision Guide | Morgan Stanley (2024)

FAQs

Does Dave Ramsey recommend investing in gold and silver? ›

I'd stop investing in gold and silver completely. I don't put money in precious metals at all, because they have a lousy long-term track record. — Dave Ramsey is CEO of Ramsey Solutions.

Are gold and silver good long-term investments? Gold and silver, as well as other precious metals, are typically long-term investments. Silver tends to be more volatile than gold, but gold is generally perceived as a long-term tool for preserving your assets.

However, in comparison to gold, silver is more abundant on Earth, which means it doesn't have as much upside potential as an investment. Silver remains an attractive investment option in 2024, mainly as a hedge against inflation and other economic uncertainties.

Gold can be a good investment option in specific situations, such as when inflation is high. During these scenarios, gold can outperform the stock market. However, gold is typically a poor investment option when the economy is strong.

Commodities like gold are speculative, so you should only invest what you can afford to lose. Orman recommends putting no more than 5% of your investments into commodities.

Deciding how much gold and silver to hold in your portfolio should be a personal decision. Generally speaking, investors put about 10-15% of their wealth into precious metals. Although gold is under-allocated in investment portfolios, the majority of our clients invest around 10-15% of their assets in precious metals.

Some analysts recommend allocating 5–10% of your portfolio toward gold and silver. Others suggest allocating up to 25%. So you may be wondering, “How much gold and silver should I own?” It depends on your situation and needs.

And like all gold investments, 1-ounce bars can serve as a hedge against inflation. That means buying in now, while inflation remains high, could deliver big benefits.

What Are the Risks of Investing in Gold? There are several risks to investing in gold, including as follows: Price volatility: The price of gold can be volatile, and it may fluctuate significantly over short periods.

ING anticipates continued strength in gold prices and expects them to average $2,031 per ounce in 2024, with a fourth-quarter average of $2,100 per ounce.

What is the best precious metal to invest in in 2024? ›

For many investors, including myself, silver is the more affordable alternative to gold. While not as firmly as it is with gold, silver is still considered a safe haven asset — making it a very viable investment in the long run.

Eventually, gold could approach $5,000 by 2030. Our gold price prediction for the coming years is directionally bullish. Some periods of weakness with gold price pullbacks may be expected. Gold price targets: $3,100 in 2025 and closer to $4,000 by 2026 with a gold peak price prediction of $5,000 by 2030.

Most experts recommend limiting your gold investment to 10% or less of your overall portfolio. The range between 1% and 10%, however, will often vary based on your age and overall investor profile.

If you want an investment that provides an income stream, stocks are likely the better choice. Note: You might be able to earn dividends from gold stocks or gold ETFs, but these are riskier than investing in physical gold like bars and coins.

The easiest way to invest in gold and silver is to buy one or more exchange-traded funds (ETFs). The key advantage is that they are extremely liquid, and you can buy or sell them within your brokerage account. This allows for easy portfolio rebalancing and an inexpensive and hassle-free buying/selling process.

Ramsey often recommends allocating investments into four types of mutual funds: growth, growth and income, aggressive growth, and international funds. This diversification strategy helps protect against market volatility and ensures a balanced approach to retirement savings.

A conservative approach might allocate 5-10% of your net worth to precious metals. This allocation provides a hedge against economic instability without significantly impacting your portfolio's growth potential.

The world's stock markets will usually drop during a recession, as business downturn pushes investors out of stock markets. This in turn drives investors towards physical, safe haven assets, such as silver and gold. During a recession gold has generally performed well, achieving significant growth.

As a result, many experts recommend a precious metal portfolio that ideally consists of 75% gold and 25% silver. This is because the silver price tends to be more volatile than that of gold and will therefore have a larger impact on the value of your precious metal portfolio as its price fluctuates.