In the wake of recent world events, the markets have been rife with uncertainty. The Middle East has been riven by conflict, the European Union has been struck by crisis after crisis, and America is facing one of the most controversial presidential election contests in history. To add insult to injury, the existing tumult has been stirred to fever pitch in recent weeks by Britain’s vote in favour of Brexit.
This has left many investors in a quandary, wondering whether they should stick with their existing strategies, or retreat to safer ground and implement a more conservative approach to trading. For many, the latter has won out, and as a result, safe haven assets have surged.
If you’re new to the markets, however, you might not fully understand the purpose of these. Your portfolio may currently consist of only one type of investment instrument, so the thought of adding additional assets can be daunting.
In the case of safe havens, it needn’t be. Used by even the most experienced of investors during troubled times, these assets retain or even increase their value when volatility is at its peak, and are perhaps the most efficient tool in existence for limiting market losses.
If you’re considering adding them to your portfolio, then here are just three of the reasons why this is a very good idea under present circumstances…
Stability
One of the key points in favour of safe haven assets is that they have a stabilising influence in times of trouble. If you’re looking for investments that will not decrease in value in order to lessen your risks, then there are none better. From gold to the Japanese yen, even the worst tumult does not drag these assets down from their lofty perches, which makes them a wonderful portfolio addition for those seeking to create a safety net of conservative choices.
This post was published at GoldSilverWorlds on August 1, 2016.
Follow on Twitter
Recent Comments