Is Gold and Silver Bullion an Asset or Investment?

If you surf the web long enough exploring the world of precious metals, you will find the word “investment” tossed around loosely with promises of a big day to come. 

The online marketplace for consumers is filled with experts who have your best interests in mind. Many predict the price “could” shoot to the moon and have convincing reasons why. The fact of the matter is, generally speaking, the only people making money in the bullion business are the companies that sell it.

Make no mistake: precious metals and bullion products like gold and silver coins and bars have their place in every portfolio. Having precious metals in your retirement portfolio is fundamental, even mandatory these days. But which is it, an asset or an investment? Or, is it both?

Assets and Investments By Definition:

The terms asset and investment are closely related but have distinct differences:

Asset: An asset can be anything you own that has value. It may generate income or increase in value, An asset can be tangible or intangible.

• Tangible Assets: Gold and silver coins and bars, collectible coins, stamps etc. can all be considered tangible. As could property, vehicles, machinery, collectibles to name just a few.
• Intangible Assets: Patents, copyrights, and goodwill are examples of intangible assets. 
• Financial Assets: Stocks, Bonds, Crypto Currency, Savings Accounts etc.

Investment: An investment is intended to give you a return (income or capital appreciation) at a later date and time. Like an asset, certain investments are physical or tangible, like real estate. Investments are typically intended to generate growth or income.

Examples of Investments:

• Real Estate that generates income like rental properties or farmland. 
• Stocks, Mutual Funds, Bonds, Crypto Currency (see Speculation)
• A business investment that generates income and appreciates in value.

Speculation by Definition:

Speculation is based on theory but without firm evidence. Investments in real estate, stocks, cryptocurrencies, and business ventures may all have the potential to gain in value but also have the risk of complete loss.

We Conclude: Is Gold and Silver Bullion an Asset or an Investment?

To be clear, all investments are assets, but not all assets are investments. Your home is an asset but unless you rent it out or sell it for a profit, it is not an investment. We maintain because gold and silver bullion does not pay any income, interest or dividends, it is not an investment but an asset. However, if you sell it for a profit, it is in that case an investment.

Unlike an investment, gold and silver bullion can never be worth zero. It cannot go bankrupt. Its stability throughout the passage of time is proven. Can you make money if you buy gold and silver bullion? Absolutely! As the old adage goes: Buy Low – Sell High! But if you want to protect your assets from economic fallout and calamity, there is no better asset to own on the planet!