The World Gold Council’s latest investment report pegs gold as the most effective commodity investment of 2021, with the outlook for the rest of the year overwhelmingly positive.
The report notes that in the present economic environment, with global markets showing signs of clawing back lost ground, gold remains a vital addition to any portfolio. With interest rates and inflation both expected to soar, the precious metal’s appeal will shine even brighter analysts say.
The report advises, “Gold is still the most effective commodity investment in a portfolio as it continues to stand apart from the commodities complex.”
According to the latest analysis, the World Gold Council sees six key attributes making the case to buy a clear one. It says gold, “…deserves to be seen as a differentiated asset as it has historically benefited from six key characteristics.”
It cites gold’s superior absolute and risk-adjusted returns, its diversification strength, its ability to perform even in low inflation environments, low volatility levels, its status as a tried-and-tested store of value and its high liquidity factor.
While those historic attributes all make a compelling argument to buy now, the World Gold Council further identifies several factors emerging in 2021 which give the gold bulls the edge. The report explains, “Gold is a commodity that has always stood apart, but there have been recent market developments that build on its existing differentiators while illustrating the importance of its role in a portfolio.”
Commodity reflation is one such factor, which the World Gold Council defines as being in “full effect” right now. This reduces risk appetite and should see gold demand increasing still further. In addition, the yellow metal has held steadfast in the face of other volatility, once again showing its appeal as a stable, secure store of wealth.