Goldmoney insights is a research portal available to Goldmoney clients. It provides objective and unbiased insights into prevailing market conditions and global macro trends affecting the world, markets, and culture.
It is led by Alasdair Macleod, Head of Research at Goldmoney. It also features contributions from Stefan Wieler, John Butler and James Turk.
1. Precious Metals
Precious metals are rare metallic elements that have a high economic value. They’re usually sought after for their investment properties or as a safe haven during times of financial uncertainty, inflation or war.
Some of the most common precious metals include gold, silver, platinum and palladium. These precious metals are used in jewelry and industrial applications.
Another popular precious metal is rhodium, which is used for its reflectivity and ability to withstand corrosive materials. It’s also useful for producing specialty alloys and in groundwater treatment.
Other important uses of PGMs include electronics, medicine, dentistry, chemical and photographic applications. Investors tend to place more emphasis on gold and silver, but palladium is also a viable option.
Stocks represent a share in a company, including a claim on its earnings and assets. The value of a stock can increase or decrease due to market forces and other factors.
If more people want to buy a stock than sell it, the price will rise. Conversely, if more people want to sell a stock than buy it, the price will fall.
There are a number of valuation ratios that can be used to determine whether a stock is fairly valued. These include price-to-book, price-to-earnings, and price-to-sales.
Exchange-traded funds (ETFs) track a basket of securities or a portfolio of assets, such as commodities or currencies. Shares of ETFs are traded on exchanges throughout the day and can be bought or sold like stocks.
Many ETFs mimic a particular stock or bond index, such as the S&P 500 or Russell 2000. Others focus on a single industry or sector, such as energy.
ETFs are a convenient way to build a broad, well-diversified portfolio with low fees and minimal management hassle. But they aren’t a one-size-fits-all solution and shouldn’t be considered without a thorough evaluation of their merits.
Stock ETFs offer diversification by tracking a wide range of companies, but some may be too concentrated, either in the number of securities they hold or their weightings. Investors need to evaluate their investment objectives and risk tolerance before making an ETF purchase.
Bonds are one of the most common asset classes that savvy investors include in their portfolios. They offer a predictable income stream, mitigate risk, and can also help diversify holdings.
When a government or company needs to raise funds, they issue bonds to investors who are willing to lend them money for a specific amount of time. They then pay interest on the loan until the bond “matures,” or when the borrower must repay the principal (i.e., the face value of the bond).
Credit rating agencies like Standard & Poor’s, Moody’s and Fitch evaluate a bond issuer and determine its creditworthiness. Generally, the higher the credit grade, the safer the investment.
Cryptocurrency is an alternative asset class that has been gaining momentum in recent years. They’re digital currencies that are created from code, unlike fiat currency, and function autonomously, outside of banking and government systems.
The value of a cryptocurrency depends on its utility and how many people use it to buy goods or services. It also reflects its scarcity, as a limited supply drives up the price of a crypto coin.
There are several types of cryptocurrencies, including Bitcoin, Ethereum and stablecoins such as Tether. They all differ in storage methods and circulation, but all have the same technology — blockchain.