What do billionaires do with their money? Do they acquire more investments or just spend it? What kind of investments do they make? Are billionaires buying gold? Let’s take a look at this and see what we can learn from it.
Are Billionaires Buying Gold?
Recently, the investment information source The Motley Fool discussed several well-known billionaires who are now buying or have recently bought gold. Perhaps you will recognize the names:
- Stanley Druckenmiller, former chief strategist for the famous George Soros, has put a large percentage of his $4 billion fortune in gold. At the end of the third quarter, 2015, he was one of the top 10 holders of the SPDR Gold Trust.
- John Paulson, of the hedge fund Paulson & Co., has placed close to a billion dollars in gold stock. In 2009 and 2009, Paulson made big profits in the yellow metal.
- Ray Dalio, founder of the investment management company Bridgewater Associates, has made some investments in gold mining companies such as Goldcorp, Barrick Gold and Newmont Mining.
Something to Learn From the Wealthy
It is false to think that the wealthy are just lucky or smart. Most millionaires and billionaires did not inherit their wealth. Instead they built it by saving, being thrifty, and investing wisely. Especially early in their adult lives, they systematically saved and invested, a little at a time, and then reinvested their proceeds.
Apparently some billionaires are now reinvesting some of their wealth in gold. What do they see in the gold market that appeals to them. Let’s take a look.
Consider Buying Gold Now
Gold reached its high of $1873.70/oz on Sept 2, 2011. Since then gold has fallen about 45% from its highs of five years ago. You can now (Dec. 31, 2015) buy an ounce of gold for about $1060.
Smart money tries to invest when prices are low, not high. Smart money is patient and after acquiring at a reasonably low prices, waits until prices rise, then sells for a profit. It looks like some of the billionaires are doing just that.
You too can buy gold now. Because of the relative strength of the US dollar, the price of gold bullion is relatively low. A strong dollar will not always be the case. History has shown that the dollar is cyclical, going through periods of relative strength to relative weakness.
Your best bet for gold purchases now are bullion coins and bars, widely available near spot price from a number of trusted sources. If you like doing business with Amazon or through eBay, excellent prices can be found at both venues. If you prefer working with an online dealer, visit one of our preferred brokers, BSACS, to purchase your gold.
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