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6 Reasons Why Gold Is the Best Safe Haven Asset

By    |   Tuesday, 30 June 2015 05:47 PM

Gold is still among the best safe haven assets, even as slumping gold prices of late have left many investors looking for the exits. Gold has proven its value as a long-term safe haven asset — a constant in the face of uncertainty and losses elsewhere — and its safe haven status also has a promising future.

Here are six reasons gold is the best safe haven asset.

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1. Inflation to The Rescue
Citigroup analyst Jon Bergtheil thinks gold could rebound beginning in 2016 once inflation kicks in and oil prices stabilize, MarketWatch reported.

2. Diversification
Gold's recent tumble is no reason to flee, because the intrinsic value of gold, regardless of price swings, makes it a hedge against potential losses in other segments of a diversified portfolio. CNBC Mad Money maven Jim Cramer recently called gold an "insurance policy."

3. Good as Gold
Gold's historical connection to global instability appears to be waning, according to former U.S. Mint director Ed Moy, a gold investment strategist who has noted that while global conflict is raging, gold prices are down. There may be several reasons why the two aren't moving in tandem anymore, but the disconnect casts gold in an interesting new light that investors are sure to explore, according to Moy.

4. Central Banks
The world's central banks, which buy gold to diversify their currency holdings, are still net buyers of gold, not sellers, and have not stopped stocking up even through the most recent price slump, Moy writes.

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5. George Soros
The billionaire investor is not fleeing gold: He's sticking with his stake in a bellwether gold mining fund, Thomson/Reuters reported. And he's not the only one holding firm on gold investments.

6. The Long Run
Gold's trading price has more than doubled in 30 years. Prince swings in certain timeframes — like right now — generate headlines and hand-wringing. But as former Gold News editor Ben Traynor once wrote, accounts of gold's volatility are sometimes exaggerated, according to BullionVault.

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Gold is still among the best safe haven assets, even as slumping gold prices of late have left many investors looking for the exits.
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Tuesday, 30 June 2015 05:47 PM
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