Ed Butowsky is the Managing Partner of Chapwood Investment Management. Ed appears live on Fox News to examine the record highs of gold and silver and whether there is a need to buy some for your portfolio.
With the overall market direction and value going down because of the liquidity crisis investors have been turning back to precious metals like gold and silver to ensure their portfolios are equipped to overcome the effects of the crisis. In many cases, these precious metal investments have been limiting the down sizing of these very same portfolios. Ed Butowsky believes that in every portfolio there should be a balanced approach to investments. This approach helps overcome the downs of the market. With silver prices at their highest since 1980 (up 36% this year alone) and gold at record highs, now more is a good time to have some of these in your portfolio.
Ed further explains that now is a great time to buy because the economy could see inflation continue to rise due to quantitative easing or additional stimulus. Due to the perception investors have about inflation, these real hard assets will go up including diamonds and real estate. It is critical to remember that these investments into alternative type vehicles are to be done in balance with the rest of your portfolio, do not over-allocate as most people end up doing. Ed has led money management boot camps where he explains the “ideal” portfolio includes 10-20% in alternative or hard assets.
Are these types of assets considered short or long term investments? Ed explains that gold and particularly silver are assets that should be part of every portfolio because of the value they retain.
Ed further explains that to buy these types of assets one should seek a reputable brokers. Many sellers of these assets have taken advantage of the system and raised their commissions upwards of 20%. A reputable broker should not exceed commissions of 5% of your purchase.