These days, investors have any number of assets to choose from — and all have varying degrees of risk. Investing in stocks, for example, offers an opportunity for high returns, but it also comes with big risks. All it takes is a market downturn to go from hefty rewards to massive losses, and it can happen in a matter of minutes.Conversely, there are more stable investment options, like gold.
That's because gold often exhibits different behavior compared to traditional assets like stocks and bonds, which can help reduce overall portfolio risk.Inflation hedgeHistorically, gold has served as a hedge against inflation. When the value of traditional currencies erodes due to inflation, gold's purchasing power tends to rise.