Why physical gold is safer than gold mining stocks

Investing in gold can be done in various ways, such as owning physical gold or investing in gold mining stocks. While both methods have their own advantages, physical gold is often considered safer.
 
We will explore the risks associated with investing in gold stocks and the benefits of owning physical gold. Additionally, we provide information on the secure storage and management of physical gold.
 

Risks of investing in gold mining stocks

Gold stocks, such as shares in gold mining companies, are sensitive to broader economic factors. While the gold price influences the stock value, several other factors play a role. These include political instability, company performance, and the regions where the mines are located.
 
Additionally, tax regulations and changing environmental legislation can impact gold stocks. Gold stocks can be affected by economic recessions and market crashes, and they are subject to market volatility.
 

Benefits of owning physical gold

Physical gold has intrinsic value and offers protection against inflation. Unlike gold stocks, physical gold represents direct ownership of a tangible asset.
 
This makes it less vulnerable to company bankruptcies and systemic risks. During economic uncertainties and financial crises, physical gold retains its value, making it a reliable store of value.
 

Liquidity and accessibility of gold

Physical gold is easily liquidated and can quickly be converted into cash. In times of crisis and emergency, it is directly available without relying on the performance of financial markets.
 
Investors can easily sell their gold to local dealers or through specialized platforms, ensuring a high degree of accessibility.
 

Storage and control for secure physical gold

While holding physical gold involves certain risks, such as theft, various solutions exist to minimize these risks. It is important to choose secure storage methods and maintain control over your gold. The Silver Mountain offers secure storage facilities in Rotterdam and Zurich.
 

Independent management of gold assets

Secure storage of physical gold can be achieved using certified safes, secure storage facilities, and banks with specialized services for valuables.
 
By storing your gold in these ways, you retain full control over your assets. You are not dependent on third parties, and your gold is always directly available when needed. This ensures optimal security by managing your gold independently.
 

Protection against cyber threats

Cyber threats are a daily concern. Physical gold poses no risk compared to cyber threats and digital attacks that can affect investment portfolios.
 
Gold stocks and other digital investments are susceptible to hacks, system failures, and other cyber incidents. High digital security does not eliminate the risks of loss due to cybercrime entirely.
 
This risk remains, which is why physical gold is a significantly safer investment. Physical gold is immune to such digital risks, providing an additional layer of safety and security for investors seeking to protect their wealth from technological threats.

Disclaimer: The Silver Mountain does not provide investment advice, and this article should not be considered as such. Past performance is not indicative of future results.