Gold: Why It’s NOT a Good Inflation Hedge

Gold has been a longstanding investment, trusted by those wary of Central Banks and those seeking to hedge against inflation. In this video, Ed Butowsky explains why gold is not a reliable hedge against inflation.

See the video below to learn more.

Summary:

• Gold is not an effective hedge against inflation.
• In 2024, despite a decrease in inflation, gold prices have risen, indicating no direct relationship.
• Media and advertisements often claim gold and inflation are as simple as one goes up and the other goes down, but the reality is more complex.

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Investments in commodities may have greater volatility than investments in traditional securities, particularly if the instruments involve leverage. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments. Use of leveraged commodity-linked derivatives creates an opportunity for increased return but, at the same time, creates the possibility for greater loss.