Should Gold Investors Be Worried about the Rising Treasury Yields?
In March, the 10-year Treasury yields reached 1.8%. This caused some experts to state that the stock market was about to collapse - apparently investors would choose a guaranteed annual interest of almost 2% over holding stocks, which have appreciated enormously in the past few years.
The same logic seems to be valid for precious metals: why buy gold if it doesn’t render any passive income? Isn’t it better to sell it and buy treasury yields instead?
However, the founder of Mobius Capital Partners, Mark Mobius, thinks otherwise. He recently said that even if the Treasury yields rise to 2%, investors should still keep buying precious metals as a long-term investment. According to the expert, it’s worth investing in precious metals because they are a form of hard money. He stressed that those investors who add gold and silver to their portfolios are acting sensibly and that one should aim to keep 10% of one’s investments in precious metals, especially gold. Here it’s worth noting palladium has recently outperformed all other assets in this group.
Mark Mobius is feeling optimistic about gold’s prospects, even though the yellow metal is struggling to get back on track. The market is under pressure from the rising Treasury yields. But Mobius thinks that 2% isn’t high enough to lure over too many gold investors.
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