watch now3:1903:19I'm still bullish on gold 'even at these levels,' says CFR's Rebecca PattersonClosing Bell: OvertimeGold prices surged to a fresh record on Monday as investors wait for key inflation data and clues from Federal Reserve officials the spect of more rate cuts to come.Spot gold is now over $3,700 per ounce.
So far this year, bullion has notched roughly three dozen record closes, gaining more than 40% as of Friday.As a safe-haven investment, gold tends to perform well in low-interest-rate environments and during periods of political and financial uncertainty.
Investors see gold as tective against "bad economic times," according to re by the Federal Reserve Bank of Chicago."Gold checks all of those boxes," Sameer Samana, head of global equities and real assets at the Wells Fargo Investment Institute, told CNBC earlier this month.More from Financial Advisor Playbook:Here's a look at other stories affecting the financial advisor .He invented the 4% rule — why he calls inflation retirees’ ‘greatest enemy’Treasury released early list for ‘no tax on tips’ deduction, but some jobs won’t qualifyThere’s a ‘golden opportunity’ to pay 0% capital gains under Trump’s tax billAccording to Wells Fargo Investment Institute's recent investment strategy report, its analysts "expect gold purchases by global central banks and heightened geopolitical strife to support demand growth for precious metals.""Without a doubt, gold has been higher, and it's getting a lot of attention from investors," said Blair duQuesnay, a chartered financial analyst and certified financial planner, who is also an investment advisor at Ritholtz Wealth Management.How to invest in goldTo invest in the precious metal, investors can either buy physical gold or gold-related financial investments.
Most experts recommend getting investment exposure to gold through an exchange-traded fund that tracks the price of physical gold, as part of a well-diversified portfolio, rather than buying actual gold coins or bars."In times of acute stress, gold stocks underperform, so to the extent that people want exposure, a gold bullion-backed ETF does a better job than gold-related equities and gold miner stocks," said Samana.SPDR Gold s (GLD) and is Gold Trust (IAU) are the two largest gold ETFs, according to ETF.com."Gold ETFS are going to be the most liquid, tax efficient and low-cost way to invest in gold," duQuesnay said."It's much more inefficient to own physical gold," according to duQuesnay, largely due to higher transaction costs and storage considerations of bullion, including bars and coins.Alternatively, gold mining stocks are not as closely linked to the underlying price of gold and are more tied to fundamentals, she added.Despite gold's record run, financial advisors generally recommend limiting gold exposure to less than 3% of one's overall portfolio.
CNBC Financial Advisor Council member duQuesnay told CNBC earlier this month that she has no gold in the portfolios she manages for her clients, in part because of the temperamental nature of any trendy investment."Are we in the third inning of this rally of the ninth inning?
Gold is priced as a commodity, and that can make it hard to pinpoint the fundamentals," she said. to CNBC on YouTube.