If you are looking for a solid asset to include in your investment portfolio, precious metals have been considered fundamental to a well-balanced portfolio for hundreds of years. Gold and silver have unique properties as an asset class, and a modest allocation in either can protect and enhance the performance of an investment portfolio.

Investors and funds, such as SMSF, should select precious metals with several key factors in mind:

1. Liquidity and speed in transactions: The choice of precious metals should focus on those that are liquid, facilitating their purchase and sale in the market.
2. Correlation with other assets: Diversifying the portfolio is essential to mitigate risks. Evaluating the correlation of precious metals with other assets in the portfolio is crucial.
3. Purpose of the asset: Some investors choose precious metals, such as gold, as a hedge against crises or inflation protection. This purpose should be in line with the investor’s investment objectives and strategies.
4. Costs: Careful consideration should be given to the costs associated with the acquisition and retention of precious metals, including audit fees and insurance costs.