Webinar summary: How to invest to beat inflation!
21st Jan 2022
Reading Time: 5 minutes
We recently hosted a FREE webinar all about how to invest to beat inflation. Hosted by our founder and CEO Jasmine Birtles, the webinar discussed the various ways to invest your money during these inflationary times.
Jasmine was joined by Karina Hicks from The Royal Mint, who are the kind sponsors of this webinar. Karina previously worked with Jasmine on a podcast, in which they discussed investing in gold and other money metals. You can listen here.
Jasmine also talked with Jim Osman, founder and CEO of The Edge, a consultancy service which specialises in fundamental analysis of spin-offs, activist ideas and more.
Lastly, Boaz Shoshan joined the webinar, from Southbank Investment. Boaz has recently worked with Orca to produce a beginners guide to decentralised finance, as well as presenting a beer themed markets podcast called Booze, Booms & Busts.
This webinar covers everything, including investing in gold, the stock market, cryptocurrencies, property and more!
Watch the full webinar and read the summary below, and find out how to invest to beat inflation!
Why invest in gold?
- There are lots and lots of reasons why people choose to invest in gold
- It has been considered by many as a hedge against inflation – both individual investors and countries around the world
- It is a real, tangible asset and it has always tended to hold its value over the long-term
- It is a widely recognised asset, and the gold market is absolutely huge
- This makes it a very liquid asset – it is easy to buy and sell globally
- Gold tends to perform well during times of high inflation
- It hasn’t rallied as well as hoped over the last 6 months, but this is due to a number of factors including the pandemic and a huge increase in demand in 2020
- Despite this, demand certainly hasn’t dwindled
Is now a good time to buy gold?
- Some people think crypto will overtake gold, but this is unlikely to happen in the long-term
- People who are investing in gold don’t need to, and shouldn’t, fear crypto
- They are ultimately very different things
- Gold was not created by man, whereas Bitcoin was, making them different commodities
does investing in stocks and funds hedge against inflation?
- Over the long-term buying good quality names at cheap prices pays off
- Big, popular names may well fall drastically, for example Peloton
- Growth stocks don’t handle inflation as well as Value stocks
- People want to go where the money is – but my golden rule is don’t chase the ‘hot’ money
- By the time you get to it, it’s likely gone
- It’s important to understand what is next and what the next phase of the world is
- Always invest for the future, don’t look in the rear-view mirror
How should small investors be thinking?
- You don’t need to be in one camp or another when it comes to investing in new markets or traditional ones
- You don’t have to totally steer clear of the ‘hot money’
- When it comes to precious metals, particularly gold and silver, they are used as a good inflation hedge because they are relatively stable
- Gold should be treated as a form of insurance that you don’t want to claim on
- It comes down to diversification and it’s absolutely key in any strong portfolio
- Gold is often seen as a useful diversifier, particularly as it tends to react differently to other investment types
- There’s been lots of analysis about how much of your portfolio you should allocate to gold
- Generally, the recommendation is between 2% and 10%
Is gold losing out to silver?
- I wouldn’t say it’s ‘losing out’ – at the Royal Mint gold is most in demand, but there’s still a huge demand for silver too
- They have many of the same qualities – they are finite resources and have intrinsic value, but silver has a significantly lower price point
- Silver can be more volatile than gold
How can you buy gold from The Royal Mint?
- It really depends on personal preferences
- People have different budgets
- Some people want a physical version of their gold, they want to be able to look at it and touch it
- There are many different sizes for people of all budgets and all levels of investment experience
- There are also digital options, which are growing in popularity
- It is backed by physical gold but is run by a digital online account
- Digi-gold is stored at The Royal Mint and covered by insurance
- Try not to tell people about your investment in gold for safety
- With digi-gold you can decide the monetary value, so it’s more cost-effective
What is an ETC?
- An ETC is an Exchange Traded Commodity
- Our ETC at The Royal Mint allows you to track the price of gold
Is crypto volatile?
- It can be volatile, but there is vast treasure within crypto
- If it was a physical market, you wouldn’t want to go in unarmed, but it can offer great reward and promise for those who brave it
- It can be a risky game but there is great treasure out there
How do I choose my investment types?
- Anything you invest in should start with a risk
- You should try something that is speculative
- Manage your risk and be prepared to lose out sometimes
- If you aren’t prepared to lose out on a particular commodity – whether it be stocks, bitcoin or something else – then don’t do it
- If you aren’t prepared to invest in something in particular, then don’t!
- Maybe put 60% in an ETF that tracks the index, put some in crypto and some in gold
- It’s ultimately down to your risk tolerance
are Innovative Finance ISAs good?
- ISAs are very interesting, the rules change between them
- There used to be very few providers, but that may have changed since I was a financial advisor
- Take a look around and see if there’s anything viable that earns you a decent yield
- The yield is higher, but there is also greater risk
What is the stock market?
- People assume buyers and sellers are professionals who all know what they are doing – this is far from the truth
- It is similar to gambling – it’s a huge risk
- Strange factors can influence the markets at any time
- Just because a stock goes up, it doesn’t always mean a company is doing well
What drives markets?
- Emotion – we are humans and driven by our emotions
- Crowd behaviour – it is tempting to follow the crowd
If you enjoyed this webinar, why not join Jasmine for our next one? Check out our list of upcoming webinars here.