Gold has been a precious currency for centuries, and its popularity as a hedge against inflation, currency fluctuations, and other economic troubles has only grown recently. Owning gold was once an exclusive opportunity reserved for kings, but now everyone can invest in it through gold funds. Investing in a gold fund can be an excellent way to protect and grow your wealth, and the gold fund available on ndovu’s platform is one of the best options in 2023.
Why Invest in Gold Funds?
There are two primary ways to invest in gold: directly, by buying and storing physical gold, such as bullion or coins, and indirectly, by purchasing gold-related securities or funds. While purchasing physical gold can be challenging to obtain and store, investing in gold funds is more accessible and has several benefits, including:
- Hedge against inflation: Gold tends to hold its value and preserve purchasing power over the long haul, making it an intelligent way to fight inflation. Gold’s value may fluctuate in the short term, but it’s relatively impervious to market swings in the long run, making it an excellent counterbalance to more volatile assets like stocks.
- Diversification: Gold funds have a low correlation to stocks and bonds, meaning they are less affected by economic events that might affect other investments. Additionally, gold funds have a negative correlation to the US dollar, so when the dollar loses value, the value of gold funds strengthens, and vice versa.
Read more about diversification and why it’s essential for your investment portfolio.
Strong performance: The price of gold has been on the incline since November 2022, and the Gold Fund has gained approximately 14.65% in returns globally over the past year. Analysts and experts across the globe expect gold to hit record highs in 2023, with gains of up to 20% by the end of the year, making now an excellent time to invest.
Potential Risks of Investing in Gold Funds
As with any investment, there are potential risks to investing in gold funds, including:
- Price volatility: The price of gold can be volatile and may fluctuate significantly over short periods, making it difficult to predict its value and making it a risky investment.
- Inflation risk: While gold is an effective hedge against inflation, there is no guarantee that the price will increase along with the inflation rate.
- Political risk: Political events, such as wars, national elections, and changes in government policies, can affect gold prices.
- Storage and insurance costs: If you physically buy gold, you will need to store it safely and insure it against loss or damage, which can add to the overall cost of your investment.
How to Invest in Ndovu's Gold Fund
Investing money can sometimes be intimidating especially for beginners. With many investment opportunities out there you need to consider a number of things in order to decide which kind of product to invest your money, including:
- Your Investment Goals.You should consider what your short and long term goals are before investing. Is your priority higher returns or preserving your capital? Answering these questions can help you pick the product that best suits your needs.
- Your Risk Appetite. Fixed Return Products like all investments carry some level of risk so it is important to analyze how comfortable you are with the risk levels of different Return Products in order to inform your investment strategy.
What Are The Risks Associated With Fixed Return Products?
Through ndovu – it is easier for first-time investors to access a broader range of investment options previously only available to select investors. Through our secure online investment platform, we offer an easy and affordable way to invest in gold through our gold exchange-traded fund (ETF).
What is an ETF? Simply put, an ETF is an investment fund that allows you to buy a large set of individual stocks, bonds, or a single unit commodity in one purchase. Investors can invest indirectly in gold with Gold ETFs, as the price of the ETF is directly linked to the cost of physical gold. Investors can buy and sell shares of the ETF on the stock exchange just like they would with any other stock.
In Kenya, a gold ETF was introduced in 2017 to the Nairobi Stock Exchange (NSE). So why invest in gold through Ndovu and not through the NSE? Let’s look at the reasons;
- Affordability and accessibility. The NSE requires investors to purchase at least 100 units to invest in their gold ETF. If gold trades at Ksh 1200 per ounce, one must fork out at least Ksh.120,000 to invest. However, at Ndovu, with as little as $50, you can invest in the gold fund, making it accessible to a broader range of investors.
- Great returns. With Ndovu’s gold fund, you can earn up to 14.65% annually. If you invested Ksh 100,000 in Ndovu’s gold fund six months ago, you would currently have Ksh 107,325.
Sign up on ndovu today and take advantage of this golden opportunity to protect and grow your wealth. Consider the potential risks before investing, and speak with a financial expert if you need more guidance.
Disclaimer: Ndovu does not offer any guarantees on returns. The quoted return reflects the fund’s past performance for the past year.
Disclosure: Ndovu is a regulated Robo-Advisory platform operated by Waanzilishi Capital Limited (‘Waanzilishi’). Waanzilishi is a fund manager licensed by the Capital Markets Authority (Kenya) and a Data Controller Registered by the Office of the Data Protection Commission
