Twenty-three percent of Ultra-High Net Worth investors deal with precious metals
Outside of stocks and bonds, precious metals remain a popular investment choice for the ultra-high net worth investor, even as gold prices fluctuate with news from the American economy.
When Federal Reserve chairman Ben Bernanke announced Wednesday that the economic stimulus for the United States would remain in place for an extended period, gold prices rallied and recorded its third consecutive day of gains Wednesday.
Advisors and gold experts report that the gold market will continue to be volatile as its appeal turns away from a holding investment to more gold jewelry business in the near future.
In a Spectrem Group Millionaire Corner study released in the fourth quarter of 2012, investors listed precious metals as their second preferred “other investment’’ after real estate investment trusts (REITs). Twenty-three percent of UHNW investors surveyed listed precious metals, matching “collectables” as an investment option. Thirty-six percent reported interest in REITs.
Among UNHW investors under the age of 44, gold was the most popular “other’’ investment, with 40 percent of those surveyed purchasing precious metals, matching the percentage of investors interested in private equity.
An April 2012 study of those with net worth over $25 million indicated 39 percent of investors own precious metals as an investment, although zero percent indicated an interest in further investment over the following 12 months.
Twenty-two percent of those aged 45-54 and those identified as managers reported plans to invest or invest more in precious metals over the next 2 months.
When the Fed decides to slow economic stimulus, interest rates will rise, money will tighten and the gold market will suffer as a result, according to most analysts.
Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.
In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.
McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.
McDill is the father of four children, and an active fan of soccer, Jimmy Buffett and all things Disney.