Precious metals have long stood the test of time. They are a safe
haven in times of uncertainty, strife and conflict. If the markets are confused
and participants don't know what will unfold, then the markets themselves take
a hit while
gold and silver receive a boost, fulfilling their role as a safe
haven asset.
This scenario has unfolded time and time again throughout history and we are
once again seeing it happen, especially in the case of the king of metals: gold.
Gold ETFs received a massive
inflow
of funds throughout the month of January. The numbers are out
and they are truly stunning. Market participants sent almost $1.6 Billion
dollars into ten of the most attractive gold ETFs on the market.
The Xetra-Gold ETF was the largest recipient of this flow of funds, but far
from the only one that benefited greatly from the recent global uncertainty
that we see unfolding all over the world.
Since taking office, the new US administration, led by Donald Trump, has put the
old global order on notice. This is causing many to take the prudent steps of
protecting their funds, as it is anyone's best guess as to what is
going to happen in the short term.
Global markets are going to face great uncertainty and volatility while globalism is being challenged in each election that we see unfolding. Likely,
this is going to cause a minor to severe crash in the markets, as things are
reshaped and global trade is re-balanced.
What also must be noted is the fact that gold ETFs are not the only winners in
this scenario. Many are also parking their hard-earned money into gold mining
stocks as well, as some of the largest producers in the industry see their
share prices rising.
Whether you like it or not, volatility is here to stay. The markets are going
to gyrate and they are going to have to adjust to the new reality that the
world now faces.
This period of time will make even the most battle hardened investors weak in
the knees, but steps can be taken to lessen your risk. It begins with
investing in physical precious metals.
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Nathan McDonald is a libertarian, entrepreneur and precious metals enthusiast. He has always taken a keen interest in free markets and economics since an early age, which naturally led him to become a true believer in precious metals and all that they stand for.
Nathan served eight years in the Royal Canadian Navy as an electronics technician, seeing the true state of the world, before starting his first successful business. He has since gone on to create a number of businesses, all of which are still in operation and growing.
In addition to this, Nathan runs a network of successful precious metals blogs, and a growing newsletter that has attracted readers from all around the world.
He is a regular and highlighted writer for the highly respected Sprott Money Blog, which covers world events, geopolitics and of course precious metals.
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The views and opinions expressed in this material are those of the author as of the publication date, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.
